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Power Broker Strategies: What to Consider before Expanding
By Barbara Pronin
When it comes to growing your company, it’s all about keeping your eye on the end goal, says Helen Hanna Casey, president of Howard Hanna Real Estate Services. For Casey, that end goal has always been to become a large, regional player. And that’s exactly what the firm did…right in the midst of a struggling real estate market.
Helen Hanna Casey President Howard Hanna Real Estate Services Ohio, Pennsylvania, Michigan, New York, West Virginia 2012 Transactions: 37,986 2012 Sales Volume: $6,682,415,983 Source: RISMedia’s 2013 Power Broker Report
Barbara Pronin: Why did you focus on expansion at a time when so many companies were contracting? Helen Hanna Casey: Back in the early ’80s, we had many choices. Like most of the national players, we looked at the options and made some strategic decisions—among them, to do our own thing and keep our eye on the end goal—which was to become a large, regional player. That is still part of our identity. So we adapted a new, multi-generational marketing strategy and just moved forward. Recently, for example, we decided to allocate $250 million for expansion and acquisitions in our current market and into new markets in the Northeast, Mid-Atlantic and Midwest regions of the country.
BP: What factors should be taken into consideration before expanding? HHC: For us, expansion has been a key to our growth. You have to keep food on the table, of course – and good banking relationships are essential. You need to carefully consider the financials. What’s the cost of operation? What’s the likely gain? And, as important, what’s the buy-in of your people? We are a close-knit, family company. Everyone has to be on the same page.
BP: When is it better to acquire, and when is it better to merge? HHC: That depends on the market area. We never merge—only acquire, especially in a new market area. We’ve acquired well over 40 companies in the last 10 years.
BP: Should expansion focus more on increasing a firm’s footprint or on agent count/productivity? HHC: Both, really. Footprint is important, although you have to consider the administrative impact. But really, the two go together. We recently became a Christie’s Great Estate rep in Pennsylvania, and we expect that offering their trophy homes and estates will boost our bottom line.
BP: How do you minimize the risk as you pursue your growth strategies? HHC: You minimize risk by having the right people on board. You can’t undervalue your CFO, who understands the end game as well as the financials. And again, you have to be inclusionary of everyone on your executive team.
Barbara Pronin is a Contributing Editor for RISMedia. She has been writing about real estate for more than 30 years, and is also the author of six mystery novels and two non-fiction books.