Good stuff, Hot News, .. and most of it on the money.... I ran a fair sized general estate agency for many years, in an up- market area of northern Sydney. Residential real estate is a fickle market, as the McGrath IPO is discovering, (commercial real estate sales are based primarily on balance sheets and yields/residential on emotion, etc) so potential vendors, choose, in their view, the best agent, when selling, .... not necessarily the best agency. This conundrum, on how to retain quality agents, with their wide variety of contacts, and a deep database of potential sellers, ( which stay with the individual agent, they are not the property of the agency concerned),....is, and always was, and always will be, a critical issue in managing any estate agency, ASX listed or not, should an individual agent, or in McGraths case, agents, decide, for whatever reason, to move on. John McGrath lifted the bar in general agency practice through the early and mid 200o's, his clean, uncluttered marketing look, great copy, niche photography, and understanding of how the evolving internet, (real estate wise)... worked/ and would work, left most of his competitors in those days in his wake, including me. lol. So, back then, he attracted good operators to his brand. And expanded the brand, logically. Then McGrath indulged in franchising, which, within the inexact science which is real estate general agency, gives the franchisor maybe 8/10% of each gross sale, in return for marketing, sales, network , intrinsic support etc, to ostensibly make each franchisee another John McGrath. Keeping his, mostly urban offices company owned at that point, made sense. He was flavour of the month. However, when he caught the franchising bug, real estate wise, and unlike common product franchising, (McDonalds, KFC,) etc, agency , I can state personally with,.... some trepidation, real estate franchising, can make herding wild cats into the same bag, look like childs play. New brands can quickly look stale, without 24/7 direction, guidance etc. One guy, however astute, cant do that. Good support, and on selling some McGrath branded sub franchise networks to good individual operators, (Shane Smollen, for example) as he did, merely made the hunter....eventually, the hunted. I could go on and on about the inevitable egotistical rows about sell/listing splits within agencies, and how, and why, they distort the overall agency net take, commission wise, or the undervaluing of most agency proprietors of the un glamourous side of general agency, ( property management) However, Boardwalk Empire is on tv, and that's far more riveting.
MEA Price at posting:
72.0¢ Sentiment: None Disclosure: Not Held
