Real deal? Keller Williams moves in
Even through the recession of the last three years, the Charlottesville real estate market stayed hot. Local real estate firms thrived, and now, it seems, a newcomer is hoping to reap the benefit as well.
"Keller Williams wouldn't be here," says principal broker Kim Armstrong, "if it didn't think it could succeed here."
Indeed, Keller Williams has been enjoying massive agent growth in the 18 years since its 1986 founding in Austin, Texas. According to the company website, kw.com, since it franchised in 1991, 317 offices have opened across the U.S. and Canada, and nearly 25,000 agents have signed on with the business that Armstrong calls a "company for the agents."
Armstrong, who has been a local real estate agent for 17 years and most recently worked for Real Estate III, says she decided to make the change because of Keller Williams' "unique philosophy."
That philosophy, she says, includes an emphasis on technology, agent training and education, and, perhaps most interestingly, recruitment of other agents.
Armstrong describes that process as "creating teams." When an agent joins Keller Williams, he has the opportunity to build his own team by inviting other agents to join the company. The team leader gets a percentage of the commission of all of those agents who signed up below him. And each team member has the opportunity to create his or her own team, ad infinitum.
Pat Burns, broker owner of RE/Max Realty Specialists, says he has some questions about the philosophy.
"I think on paper it looks like an interesting concept," Burns says, "but I wonder if it will pan out for them."
Roger Voisinet, an agent with RE/Max, says he was called once by a Keller Williams representative but turned down the opportunity. He says he prefers the RE/Max model, which gives him 100 percent of his commission but requires him to cover his own advertising expenses in addition to a flat rate paid to the company.
Keller Williams, Voisinet says, seems to be "more of a way of making money by recruiting other agents."
Another local real estate insider, who asked not to be named, goes a step further, comparing the Keller Williams plan to Amway, a multi-level marketing company in which members recruit as many others as possible to sell products from a catalog. Those who get in early, the insider points out, do quite well. It's the latecomers– or those near the bottom of the alleged pyramid– who never make a dime.
But Armstrong is quick to deny the Amway comparison.
"Amway is a product," says Armstrong. "We're dealing with people's lives." The Keller Williams model "is not a pyramid," she insists. "It's a way to perpetuate your business."
"A lot of realtors never think to sell their businesses when they prepare to retire," says Armstrong. Keller Williams, she says, is "one of the few real estate companies where you can actually retire."
And, Armstrong says, recruitment is just one small facet of the Keller Williams program– and one she believes benefits the consumer.
"We're a culture of teamwork and cooperation," says Armstrong, citing corporate meetings called "family reunions," and Keller Williams University, where new and established agents go for further training. "It helps the agents improve the quality of work for the client."
Bill May, owner of ERA Bill May Realty, says he's a big fan of Keller Williams.
"I love their program," he says. "I use a model very similar to theirs."
May says the arrival of a new company in town shouldn't harm other real estate businesses since Armstrong and several other Keller Williams agents (who Armstrong declines to name because they have not given notice at their current employers) were already a force in the local market.
"It hasn't affected the volume of business," says May. "It just moved it from one pile to another."
Armstrong says her company is making a major investment in the area– starting with its local offices: 5,800 square feet leased for five years in the Citizen's Commonwealth Building on Preston Avenue. Renovations to the space are currently under way, and Armstrong hopes the office will open mid-February.
But even before then, you may notice some new red and white signs brightening the yards of houses for sale.
"We already have listings," says Armstrong.
Keller Williams has new downtown digs.
PHOTO BY JEN FARIELLO