Mergers and acquisitions in estate agency – the unintended consequence?

In recent weeks we’ve seen a flurry of takeover deals, arguably the likes of which we haven’t witnessed since the late 1980’s when the Prudential, Halifax and the like were hoovering up estate agency chains like freeloading relatives at a wedding buffet.

Countrywide has become Connells. Douglas & Gordon reverse into Foxtons, as Hunters are absorbed by TPFG, Gibbs Gillespie are taken in by Leaders Romans and Dexters buys Roy Brooks. This is all in less than three months of the year beginning and rumour has it that there are more takeover surprises to come in 2021 still, especially now that Dexters have ‘kids in a candy store’ money.

At this rate, one wonders whether in the next few years most estate agency transactions by way of market share will be ‘owned’ by just five or so big groups? After all, that’s how most sectors end up as Procter and Gamble, Unilever, Kraft, Comcast, Mars, Kellogs, Facebook, Ford, Nat West, Rupert Murdoch’s News Corp, Sports Direct and so on, ultimately control vast swathes of a commercial genre. Some might call this monopolistic as in essence a handful of companies headed by a few executive teams and a smattering of powerful shareholders will dictate policy, direction of innovation, fee-pricing and even ethics in each category.

I do though applaud the current M&A activity in our sector. It demonstrates an industry that is on the up, one in which investors are clearly confident. Private equity types are smart and we should feel significantly buoyed that if the plush PE shops of Mayfair are shouting ‘buy’ then it follows that we can feel confident that estate agency is in for a decent time of it in the following months and years – because the clever money says so.

But there’s a but…

As the property industry consolidates, placing more power in the hands of fewer people, how does that play-out for agents themselves? Whilst I welcome the new-found vote of confidence in our trade, I worry about what this means for those that actually do the business – those that convert it, drive it, oversee and transact the million or so sales and three million or more lettings deals each year – those that are the very foundation of our existence.

My caution is that estate agency is quite a transient business with agents moving around relatively frequently – yet if most market share becomes owned by a small band of corporate executives it surely won’t be so easy for staff to jump from one firm to another for better money or greater prospects when they are mainly owned and operated by the same people?

Salaries might start to look rather standard everywhere. Company cars the same wherever you look. Working conditions rigid and imposed as a one-size-fits all. Accordingly, earnings competitiveness may erode and job choice may reduce for those working in what could easily become corporate estate agency domination as far as the eye can see.

And will, in effect, the sometimes-bland corporate culture of one large entity then be imposed on many others then too so that individual character within a business becomes a mere memory? Unfortunately, I can think of a few London estate agencies where the ‘fun’ has gradually been removed from ‘function’.

You may disagree with me, but my resolute belief is that the value in the estate agency industry is within its people – not the brand above the door nor it’s branch network nor its balance sheet.

The value is owned by the listers, the negs and the branch managers themselves rather than a head office. Individuality rules as does the power to work flexibly and to earn what you are worth – unrestricted from red tape and bureaucracy.

I’d be interested to hear from agents what they think? Is market consolidation a good thing long term for you personally or does it mean that you will all potentially be doing more for less in the future? Are we indeed heading for a ‘Sports Direct’ approach to running estate agency businesses or will its people, particularly the best of you, resist being commoditised and step up to plough your own furrow?

I believe that the future of our industry is in the hands of the many, not the few. Don’t you?


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  1. Hillofwad71

    Agents if nothing else are an entrepreneurial bunch and if there is an appetite from private equity for a piece of the action they will be feeding it .

    The likelihood is that there will be much more M&A activity this year .The mega mergers will also be a catalyst  for those  who don’t see their futures as salarymen / women seeking to startup afresh  or head for  pastures new for a slice of equity in smaller practices

    Should imagine the Recruitment Consultants will be having a field day .


    Yesterday it was announced on EYE  that  Lloyds Bank were  entering the fray as a landlord

    Rollback the years, Lloyds Bank via Black Horse were one of the first to enter the corporate estate agency world  with the purchase of Buckell &Ballard in Berks and Oxfordshire in the early 1980s.

    This  led to the arrival of the  Building Societies.Banks and Insurance Companies  into the sector  en masse , estate agency company flotations and a field day for equity estate agency partners  cashing in the chips

    Skipton Building Society via Connells have  pressed the button on Countrywide and this could just be the start as the thundering herd follows .History repeating itself

    So not only private equity capital  looking for a home could it be a rinse and repeat as the world and his wife comes  a knocking A feeding fenzy

    Who’s next? What’s in a name?

    One of the early beneficiaries in the 1980s merger  frenzy was Jeremy Agace who trousured £37m  from  the merger of Mann &Co  with Hambro Bank the forerunner of Hambro Countrywide in 1986.  Having become one of the 1st listed  estate agents , Mann & Co  listing on the stock market in 1985

    78 year old  Simon Agace ,Chairman of the AIM listed minnow  Winkworth  holding 41%  could be another one under the predators eye

    Could 2021 also   be the year that Dexters floats on the  stock  market


    “May you live in interesting times”

  2. AlwaysAnAgent

    The rush to beat a possible CGT increase has given the impression that 2021 is a year of frenzied mergers and acquisitions.

    Most of the larger deals in this piece were well overdue and they are mainly “target” companies being taken over by larger firms with stronger balance sheets.


    Business has always been this way and the presumption that a few deals will lead to a monopoly is nonsense.

  3. TDGC

    It wouldn’t surprise me if it ended up being the 1980’s repeating itself again. Big fish buying up the smaller ones, business owners walking away with chunky sums of money, front liners having, in some cases, to fall into robotic disciplines and structures, much like a square peg in a round hole. Then, over the next couple of years those front liners getting frustrated and walking away to set up on their own as many then did in the early / mid 1990’s.

  4. HGB

    Often when ‘Big Money’ piles into an industry and prices rocket, it is an indication of a cyclical peak. Hard to see how these generous valuations leave anything there for the purchasers as all debt needs to be repaid at some point. If you look at the balance sheets of pretty much every retail company, their net worth is bolstered by the value that they put on their goodwill, which in the case of a whole ream of failed retailers usually reverts to very little once sentiment changes. The inherent value of a business is basically what it would cost to set up with a premium for not having to do this and bear the initial losses.

  5. 456Lets

    Nearly all the monopolies that have been mentioned are companies that sell products or services that are of a temporary nature.  You buy and move in, and don’t necessarily build a relationship with that company.

    Property is and always has been about relationships and for the homeowner is very emotive.  Its the same analogy as people saying well travel agents aren’t as popular – you can just buy your holiday online now.  However, a holiday is for a short period of time – and often you do it on a regular basis.

    Buying and selling property for a lot of people is something they only do once every 10 years or more! Letting property is about long term relationships looking after peoples biggest investments.

    It is interesting to watch all these mergers and acquisitions but I don’t think its a worry to a small agent.  There have always been large corporates and then there will always be the ones that start up on their own – wanting to offer a different type of experience.  Just as some clients will want to go with the apparent security of a big brand name, others will want to go with something more local and boutique.

  6. New Order in a Joy Division

    There is hypocrisy displayed in this article from Mr Quirk.
    Primarily from the fact that these mergers are created during the decimation of the property industry by the cheap online alternatives. Indeed Russell was instrumental in creating this race to bottom with his own (failed) online offering, so naturally the big boys are rallying round to fight back. The online version of estate agency changed the landscape and not for the better by creating a view to selling public that estate agency is easy and should be cheap. Where we all know this isn’t the case. The online alternatives tried to corner the market in fees and it’s only natural the corporates are now trying to do the same. What’s the difference?
    Also working on the assumption that brand identity will be changed and indoctrinated into one size fits all is exactly that, assumption. A revolution like this in t he property market has never been seen before and whilst certain modifications will be made, there is no guarantee that a blanket sweep of branding will be instigated. “You may disagree with me, but my resolute belief is that the value in the estate agency industry is within its people – not the brand above the door nor it’s branch network nor its balance sheet.” this is also a lazy jibe at the corporate environment. If you work a corporate you therefore are a mindless drone. This isn’t the case at all and having worked for both an independent and corporate there is very little difference in the main aim. Talent is identified in all settings and rewarded accordingly.

    1. Hillofwad71

      “When routine bites hard, and ambitions are low. When resentment rides high, but emotion won’t grow…and we’re changing our ways, taking different roads. Love will tear us apart”
      Ian Curtis
        Not quite, but mergers and acquistions are ever present in markets during both periods of  growth and decay A constant state of flux. The way of all flesh and from those spawn new agencies .Not everyone wants to work for Sports Direct .
      Senior partners salivating at the prospect of  a golden goodbye from gungho private equity looking for new vehicles to pump in cash .ride a brief wave and dump.
      Those talented fee earners unfortunately  not to have equity who see their  future personal ambitions of running their own show disappearing over the horizon by corporate big beasts arriving  leave and blend into small practices  and the whole merry dance starts again  

  7. AndSotheStoryBegan

    He would say that, wouldn’t he? The subtlest of P. R for a certain USA model.

    Not all “private equity companies are smart” either, in terms of predicting success – just in spotting short-term opportunity.


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