Real, REMAX CEOs call $880M deal ‘an accelerator’ 

The leaders behind Real's proposed $880 million acquisition of REMAX told Real Estate News that the deal comes down to timing and fit, with each company bringing something the other lacks.

For Real CEO Tamir Poleg, the moment reflects both companies' evolution and an environment that favors bold moves.

"We probably are at a point where the company is mature, the technology is mature for both of us to lock arms and create a better future," Poleg said in an interview on Monday.

REMAX CEO Erik Carlson's description of the deal, which is expected to close in the second half of this year, made it sound more like jet fuel.

"This can be an accelerator for both of our strategies," Carlson said. "A one plus one equals eight, nine or 10, versus one plus one equals one and a half."

Tech-powered growth plus an iconic brand

At its core, the deal pairs REMAX's global brand and franchise network with Real's technology platform and growth model.

REMAX brings scale and a footprint that includes more than 120 countries and territories, a large base of productive agents and optimism in the face of declining revenue. Real brings a cloud-based brokerage platform, tools designed to improve efficiency and output, and plans to continue its winning streak with its first chief growth officer.

"What we have is the same culture, but we have the technology and growth," Poleg said. "We don't have the brand and the scale and the global presence."

Poleg will serve as CEO of the new company, which will be headquartered in Miami and continue to have operations at REMAX's headquarters in Denver.

An integration challenge?

One of the biggest questions is how a centralized brokerage will align with a decentralized franchise system.

Poleg said the plan is to avoid the issue by keeping both models intact.

"I don't see anything breaking," he said. "Our philosophy is to continue and run the two brands in parallel and strengthen each and every one of them."

REMAX agents and franchisees will not be required to adopt Real's technology — including access to Real's platform, transaction management tools and ancillary services such as mortgage, title and its Real Wallet product — but they will have the option to do so.

"If they do not opt in to anything that this new company can offer them … everything can remain exactly the same," Poleg said.

Platform strategy

Poleg emphasized that Real views itself as a platform rather than a traditional brokerage, and that the combined company will continue moving in that direction. It's a platform with benefits for consumers as well as agents.

"Everything that homebuyers and sellers need is here … alongside that, all of the title, mortgage … insurance, home warranty," he said.

Carlson pointed to the importance of keeping agents at the center of that strategy.

"This is a people business," Carlson said. "The relationships that our agents have with buyers and sellers are of the utmost importance."

'The right scale'

For consumers, the companies argue that greater scale could mean more exposure for listings and a more seamless transaction experience.

"The network just became larger," Poleg said. "There's more exposure to listings, more knowledge flowing throughout the network, more international opportunities."

The deal also comes as consolidation accelerates across the brokerage landscape, following Compass' acquisition of Anywhere, which was finalized in January.

"The range of options in the residential real estate brokerage industry continues to rapidly narrow, as several of the industry's largest companies accelerate merger and acquisition activity," said T3 Sixty Executive Chairman and Real Estate News Founder Stefan Swanepoel. "Mega winners are now being identified and redefined."

But Carlson emphasized that it's about more than going mega.

"Scale for scale sake doesn't work," he said. "This is scale with the right scale … two agent communities that are really focused on being productive professionals."

For both executives, the goal is to position the combined company for whatever comes next.

"We don't really know how [the industry] is going to look in a few years," Poleg said. "But we just positioned ourselves very well to win."