Coldwell to franchise area offices Realty firm shed by owner Sears

July 23, 1993|By Ellen James Martin | Ellen James Martin,Staff Writer

Coldwell Banker Residential Group, the national realty chain, disclosed yesterday that it will franchise all 27 of its company-owned residential real estate offices in the Baltimore, Washington and Northern Virginia areas.

Richard Purvis, 49, who currently manages the Baltimore-Washington region for Coldwell Banker, is among the leading contenders to purchase 23 of the Coldwell Banker offices in the region, according to Harold Johnson, a senior vice president with Coldwell Banker Residential Affiliates, the Coldwell Banker subsidiary in charge of franchising.

Coldwell Banker also is engaged in discussions with other prospective buyers, all of them local realty brokers, for its company offices in the Baltimore-Washington area, said Mr. Johnson. He declined to identify the other bidders, but said that they did not include Long & Foster Real Estate Inc., a Fairfax, Va.-based company that has expanded rapidly in the Baltimore area, where it is now the second largest.

Four offices in Montgomery County will be sold to Toby Rhodes, a real estate broker there, Mr. Johnson said. The new franchise company, which will operate as Coldwell Banker Realty Pros, is acquiring, for an undisclosed sum, Coldwell Banker offices in Bethesda, Potomac, Gaithersburg and Wheaton.

"I'm interested in buying all the offices because I love all of them. I think it's going to be an excellent company," said Mr. Purvis, a 30-year veteran of the real estate industry who lives in Alexandria, Va. He has formed a partnership with two Texas investors to buy the 23 offices, which include eight in the Baltimore area and employ a total of 1,100 agents.

The Baltimore region's eight Coldwell Banker offices are in Columbia, Ellicott City, Towson, Timonium, Hunt Valley, Bel Air, Perry Hall and Dundalk.

Coldwell Banker, based in Mission Viejo, Calif., is currently owned by Sears Roebuck & Co. The retailer announced in January that it would sell off its real estate subsidiary, which currently oversees 400 company offices and 1,400 franchise offices, as part of a strategy to shed its financial services units and concentrate on its sagging retail core.

Under a deal announced in May but not yet final, Sears agreed to sell Coldwell Banker to a partnership formed by the Fremont Group of San Francisco and senior executives of the realty chain. These executives include Chandler Barton, Coldwell Banker's chairman and chief executive, who will continue in that post after the firm is sold.

He said Coldwell Banker -- which is accelerating the conversion of company-owned offices into franchise offices -- recently decided that the Baltimore area has the right type of markets for franchise operations.

Real estate offices in parts of Baltimore where home prices and sales volumes are relatively low are ill-suited to ownership by a large national company with heavy overhead costs, he said.

"There are a lot of pockets in Baltimore that would be better served by a locally owned broker," Mr. Barton said.

Mr. Purvis said that if he is successful in purchasing the 23 Coldwell Banker offices, he plans to aggressively expand and develop his franchise company, adding 10 to 15 more offices in the region in the next five years.

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