Compass gaining new teams after high-profile departures
As the market slowed down, some top teams left Compass for greener pastures, but the company continues to grow its agent count and woo new and former teams.
Key points:
- The brokerage is pointing to its end-to-end technology system and culture as selling points for agents during a down market.
- Compass has also landed some agents who were previously been with the firm and decided to return.
- Agents may be more likely to switch brands during a slower real estate market because they have fewer deals in work and can reflect on what they want from their brokerage.
After suffering some high-profile departures, Compass appears to be aggressively recruiting agents and teams as it pushes its end-to-end technology system and culture of collaboration.
Several teams have joined Compass in recent months, countering what appeared to be a trend of teams leaving the brokerage. The company has also been landing agents who had left Compass but decided to return.
Rory Golod, senior vice president of growth and communications at Compass, said the market and industry backdrop is prompting agents to ask themselves where they could be most successful.
"The real question I think they are asking is, 'What value is my brokerage providing?' In a market that is incredibly hot, it's a little easier to operate. In a market where that is not happening, then agents will step back and say, 'Am I getting all the resources to be successful?' They are looking for a company to do that."
Compass seemed to be hemorrhaging teams in the fall and winter, leading to a perception that the company might be losing market share. One of the most notable departures was luxury broker Aaron Kirman and his Southern California team of 160 agents, who moved to Christie's International Real Estate.
However, the company's overall agent numbers are going up. Compass reported in its most recent earnings call that it grew the average number of principal agents 18% year-over-year in 2022 and the retention rate was 98% in the fourth quarter, consistent with the rate from a year ago.
What Compass has to offer — and why teams are moving now
The Henry Horn Group is one of those teams that turned to Compass due in part to the brokerage's technology offering. The team, which has 11 agents in Southern California, recently left Agency Inc. for Compass.
The team wants to expand in its market, particularly in the luxury residential area, and become more efficient through technology. Group leader Henry Horn also says the team can benefit from Compass' large network of agents.
Horn said the slowdown in the market represented a good time for his team to make the move.
"In real estate, down markets rarely last, and as history has shown over and over again, upswings are always stronger and faster than any downturn," Horn said. "Slowdowns in the real estate market provide the best time to reevaluate their strategy, pivot as needed, focus on new areas of business, seek new clients, and also to make moves to a new organization that may better provide resources and opportunities for growth."
Horn noted that most teams and agents generally prefer to stay put, but team movement is particularly active right now because the market has caused shifts and disruptions. He's been in the business for 18 years and has only been with three brokerages, all of which he's enjoyed.
"Overall, I think as the market is back to full normalcy and an upswing, agents will be too busy representing clients and selling real estate to be moving around too much," Horn said.
Tech, culture are a draw
While it's inevitable that some teams and agents will try out different brands, Golod said Compass has been working on ways to keep them. Along with their technology offering, Compass' culture and emphasis on working together are selling points, which is why the company has agents and employees back at the office, said Golod.
The goal, he said, is that "this should be the last company to work for," Golod said.
And some agents who left are now returning. Genna Skolnik, an agent in the Dallas metro area, is back at Compass after just two months with The Agency, where she had moved with a team of agents.
She's now building her own team at Compass. She came back to the company for the network it provides, the technology and the leadership.
"The technology was huge. Compass just makes it so easy for clients to search, for me to search… [and] for me to be efficient," Skolnik said. "That was important."
Like Henry Horn, Skolnik also found the down market to be a good time to make a move. She wasn't juggling as many deals, so the transition was a smooth one.
For those thinking about changing brands, Skolnik said the key is deciding if what you're doing at your current brokerage is making you happy and is efficient for your clients.
"It shouldn't have to be a grind, it should be fun and easy," Skolnik said.