North Bay real estate companies grow

In the past five years, a new group of regional companies has pushed into the top ranks of Sonoma County's residential real estate market.

In a county with a mix of regional and national real estate brands, the new players include Santa Rosa-based W Real Estate, San Rafael-based Bradley Real Estate and San Francisco-based Vanguard Properties. All three companies have broken into the top 10 rankings here based on dollar volume for residential and land sales.

Owners and managers maintain that with today's technology, the smaller companies can now compete with the national brands. Among other things, they are using the internet to attract homebuyers, the vast majority of whom go online to start their home search.

“Curb appeal is not what it used to be,” said Randy Waller, who with partner Tony Shira founded W Real Estate in 2007, now the largest independent brokerage based in the county. “Curb appeal is what you see on your computer.”

Along with those new to the list, San Francisco-based Pacific Union International has grown dramatically here following an expansion five years ago and is now the county's second largest brokerage. To date this year it has completed $723.9 million in sales, according to multiple-listings data compiled by Pacific Union Senior Vice President Rick Laws, who prepares The Press Democrat's monthly housing report.

Some national companies also are expanding their local market share. Coldwell Banker, a brand of New Jersey-based Realogy Corp. remains the county's largest residential brokerage and has continued to grow in the past five years, partly by acquiring the Frank Howard Allen brokerage. To date this year, Coldwell Banker has completed $891.6 million in sales.

And Sotheby's International, another Realogy brand that focuses on the luxury home market, has advanced to the number three spot, with $403 million in sales.

Rounding out the top five are Century 21 Alliance, with $380.3 million in sales, and Keller Williams, $358.3 million.

In 2011 the top three companies were Coldwell Banker, Wine Country Group by Better Homes and Gardens and Frank Howard Allen. But Frank Howard Allen, a Marin County company founded in 1910, was acquired by Coldwell Banker in 2013.

And Wine Country Group, which five years ago had more than 200 agents and 11 offices in Sonoma and Napa counties, has slipped to number eight in the rankings. This week a new partnership announced it was acquiring five of the remaining offices. The new brokerage, with more than 90 agents, is named Better Homes and Gardens/Wine Country Group.

In the past three years, growth for the brokerages has often come by attracting agents who previously worked for Frank Howard Allen or Wine Country Group.

“A lot of folks are really disenchanted with the big box real estate brokerages,” said Paula Gold-Nocella, managing broker for Vanguard.

Market survived crash

The company opened its first office in the county in 2013 and now has five, including two in Healdsburg and one each in Sebastopol, Guerneville and Santa Rosa. Earlier this month the manager and 20 agents previously attached to Wine County Group's Healdsburg office agreed to switch to Vanguard, bringing to about 125 the number of agents working in the county for the company.

However, affiliates of the national brands maintain they still offer good value to both clients and agents.

Randy Coffman, who with Gerrett Snedaker this month acquired the Better Homes and Gardens franchise in the county, said their new company will offer stronger local oversight, better coordination with new owners of other Bay Area affiliates and more assistance from the national brand.

“That national connection means more business, more touches in this changing world for our agents,” Coffman said.

The changing landscape comes at a time when the housing market in the last decade has weathered a historic crash and rebound. The county's median single-family home price peaked at $619,000 in August 2005 and plunged to $305,000 in February 2009.

Since mid-2012, the median price has consistently increased on a year-over-year basis and last month ended at $595,000.

Nine years ago, shortly before the downturn began, Waller and partner Shira formed W Real Estate. Looking back, the two acknowledged it was perhaps the worst time to start a real estate company.

“We spent a couple of years scratching,” recalled Shira, who helped form the partners' affiliated mortgage company, 5th Street Financial.

But W Real Estate has quadrupled in size in less than four years and now has 80 agents in five offices: Santa Rosa, Windsor, Sonoma, Kenwood and Ukiah.

W Real Estate 10th

Waller, the son of Ed Waller, a founder in the local building company Shook & Waller, built his real estate business partly by selling the relatively small number of new homes that came to market in the downturn.

“We were paying attention to the developers when nobody else was,” he said. But builders now are starting to bring forth new projects and Waller expects to sell upwards of 400 units in the next three years.

To date this year, W Real Estate has completed $154.6 million in sales reported in the multiple-listing data.

It ranks 10th among brokerages operating in the county.

And the company this year sold another 112 homes not accounted for in the MLS data, comprising more than a quarter of its total sales, according to a detailed report Waller provided. Those transactions include both new homes and those sold “off market,” meaning the properties were never offered through the multiple-listing service.

The partners said they believe a significant number of clients want to work with an independent company rather than a national brand.

“We think we can do as good a job or better,” Waller said, “and you're going to be benefiting a local company.”

For years, the nationally branded real estate companies have taken a bigger share of the county's real estate market. A key change came in 1998 when one of the largest local firms, Polley Polley & Madsen, was sold to a franchise of Coldwell Banker.

But in the last few years, several regional companies have increasingly made gains.

San Rafael's Bradley Real Estate opened its first office in the county in 2011.

CEO/President Robert Bradley said the move north from Marin made sense because “we were already selling quite a bit in Sonoma County and we already had a lot of agents that were living in Sonoma County.”

Cross-pollination

The company this winter opened a Petaluma office and now has about 60 agents in its two county offices. And to date this year it has completed $155.3 million in sales, enough to rank it ninth among brokerages here.

Bradley and others said the county looks attractive for many Bay Area buyers seeking retirement and second homes.

“I think Sonoma County, dollar for dollar, is one of the better values in the whole Bay Area,” he said.

Managers for some regional companies said they want to use their Bay Area presence to help link up buyers from the south with properties in the county.

“I call it cross-pollination,” said Mitch Laufer, creative director for Vanguard Properties. His agents in San Francisco can refer clients to Vanguard agents up north familiar with Wine Country properties.

To date this year, Vanguard has sold $325.3 million and ranks seventh among brokerages.

Laufer credited those results in just three years largely to Gold-Nocella, a former president of the North Bay Association of Realtors with long ties in the county. For her part, she said business has increased because agents have asked her to join the company.

“All of our growth has been by people reaching out to us rather than us pursuing growth,” she said.

One corporate office that has shown significant growth here is Sotheby's International. With an office in Sonoma, the company has 75 agents that sell property mostly in Sonoma and Napa counties, but also cover an area from northern Marin to Lake and Mendocino.

In the past five years, Sotheby's ranking has risen to third from seventh. The company is distinctive for having an average home sales price of $1.08 million, compared to $659,000 this year for all MLS sales.

In 2013, Sotheby's added slightly more than a dozen former Frank Howard Allen agents.

Another development came two years ago when the company appointed a local brokerage manager for the office.

The manager, Jonathan Soh, said he has benefited because his agents already had demonstrated a savvy ability to produce strong sales.

“I've just been able to build on that,” he said. “It's kind of easy.”

Buyback

Snedaker, the partner in the new Better Homes and Gardens franchise, expressed hope that Coffman and he could build their company through instilling “our values and our philosophies” for both agents and clients.

Snedaker is buying back some of the same operations in which he was once a part owner. In 1996, he had helped form Frank Howard Allen Realtors -The Wine Country Group, before selling it in 2011 to Pleasanton-based Better Homes and Gardens Mason-McDuffie Real Estate.

In recent years Snedaker has been a senior vice president for the company's North Bay division. Even so, he suggested he was looking forward to once more taking over the reins of a real estate company.

“As an owner,” he said, “I can be more of a leader.”