Real estate franchise giant Realogy Corp. said net losses for 2009 totaled $262 million, as revenue fell by 17 percent from the year before, to $3.9 billion.
Cost-cutting measures allowed Realogy to cut its annual loss considerably from the $1.9 billion loss reported for 2008.
Realogy’s revenue picture also improved in the final three months of the year, with fourth-quarter revenue up 11 percent from the same period of 2008, the company said in announcing results for the year.
Transactions were up 18 percent during the last three months of the year among the 4,100 Century 21, Coldwell Banker, ERA, Sotheby’s International Realty and Better Homes and Gardens Real Estate franchises served by Realogy’s real estate franchise services.
The company attributed much of the surge to an impending expiration of the homebuyer tax credit, which was pushed back by Congress in November.
For the full year, transaction sides handled by non-company-owned franchisees were down 1 percent, to 983,516, with average broker commission rates rising to 2.55 percent per side, up from 2.52 percent in 2008 and 2.49 percent in 2007.
At 273,817, transaction sides handled by company-owned brokerages were essentially flat, although average broker commissions rose to 2.51 percent, up from 2.48 percent in 2008 and 2.47 percent in 2007.
The average home-sale price was down 11 percent for non-company-owned franchisees, to $190,406, and down 18 percent for company-owned brokerages, to $390,688.
In its annual report to investors, Realogy said it was providing franchise services to 14,500 offices and 262,000 sales associates operating under its brands in the U.S. and 92 other countries at the end of 2009, including 760 company-owned and -operated brokerage offices.
The number of offices served was down 7 percent from the 15,600 served at the end of 2008, and the number of sales associates declined 8 percent, from 285,000. The number of company-owned brokerages fell 9 percent from the 835 that were in operation a year ago.
Nearly nine out of 10 company-owned brokerages operate under the Coldwell Banker name, with the remainder evenly divided between The Corcoran Group and Sotheby’s International brand names.
Realogy, which was acquired by an affiliate of private equity firm Apollo Management LP in April 2007 in a highly leveraged deal, said its senior secured net debt totaled $2.89 billion at the end of the year. That left the company with a senior secured debt ratio of 4.66 to 1, well within the maximum 5-to-1 ratio stipulated in agreements with creditors.
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