Compass is set to acquire Attorneys Key Title, a Fort Lauderdale-based title company.
The brokerage reached an agreement to buy the firm and will close by the end of the first quarter, according to a press release. Terms of the deal were not disclosed.
Attorneys Key Title (AKT), founded and led by David O. Norsoph, will maintain its branding and offices in both Fort Lauderdale and Delray Beach, and will continue to serve clients of other brokerages, not just Compass.
With the buyout, Compass will be able to integrate AKT’s title and escrow services into its offerings, and bring that revenue in house.
Compass first got into the title and escrow business in 2018. In 2020, it acquired the Seattle-based startup Modus for $12.5 million, which it shut down 2022, GeekWire reported. In 2021, it snapped up KVS Title in Washington, D.C., LegacyTexas Title in Dallas, First Alliance Title in Denver and CommonGround Abstract in New Jersey and Pennsylvania. The brokerage also offers title and escrow services in California. The AKT acquisition marks the first time it will provide such services in Florida.
Compass’ existing title and escrow operations have shown positive adjusted earnings before interest, taxes, depreciation and amortization, a spokesperson confirmed. The brokerage launched title and escrow service integration in Southern California, and plans to expand that to its other title service markets, the spokesperson confirmed.
The move to bulk up its title and escrow operations follows a challenging few years that culminated in a triumph for CEO Robert Reffkin last year –– the firm reached cash flow positivity in the second and third quarters of last year, 11 years after its founding. However, its third quarter earnings report showed Compass didn’t expect to remain cash flow positive.
A late December Securities and Exchange Commission filing also showed that Reffkin gave up $25 million in performance-based restricted stock unit awards for a $7 million cash bonus. Softbank, a major investor in the brokerage, also sold 13 percent of its shares last month at a major discount, worth $42.3 million.
In 2022, the firm eliminated its chief technology officer and chief people officer roles. December added to the body count, with Compass cutting its chief operating officer position.
Meanwhile, Compass increased its South Florida operations last year. The brokerage opened offices in Weston and Palm Beach Gardens in April, bringing in agents to focus on western Broward County and northern Palm Beach County.