Compass has reached a deal to acquire @properties and Christie’s International Real Estate.
The brokerage giant is expected to pay $150 million and just over 44 million shares of its Class A common stock upon completion, according to a filing with the Securities and Exchange Commission. The deal, which is expected to close next year, also includes title and mortgage businesses and a total value of $444 million.
The deal marks Compass’ third major acquisition this year and by far its largest: @properties ranking among the top 10 brokerages in the country by sales volume and the Christie’s International umbrella including more than 100 affiliates across the globe, the firms said in a press release. It also marks the first time Compass will have a presence outside of the United States.
Chicago-based @properties was founded in 2000, by Thad Wong and Mike Golden. It acquired Christie’s International Real Estate in 2021, amid an effort to push harder into luxury sales in a bid to increase average deal size.
Wong and Golden will stay on as co-CEOs to run day-to-day operations, as the firms will continue to operate as separate companies, according to Compass CFO Kalani Reelitz.
“Everything you love about @properties — our brand, our culture, our tech, our marketing, and our relationships with Christie’s International Real Estate — is not changing,” Golden said in a YouTube video announcing the acquisition viewed by The Real Deal.
“This was our decision,” Wong said in the video. “We had a number of options and partnering with Compass stood out as a clear winner.”
The brokerage has grown to include more than 13,000 real estate agents in nearly 50 countries and territories, handling over $100 billion in annual transaction volume, according to Wong’s online bio. The firm has outposts across the Greater Chicago area, Indiana, Michigan and Wisconsin.
Compass expects the combined business revenue to be $500 million in its first year, with $49 million in adjusted EBITDA, according to Reelitz.
The cash portion of the deal is being funded by cash on hand and a drawdown on Compass’ $350 million revolving credit facility. Reelitz said paying down the revolver will be an immediate goal following the acquisition closing, and forecast that Compass’ net cash position would exceed the amount it draws from the facility.
Ansley Real Estate, @properties’ Atlanta-based brand, is also part of the deal and will operate as a separate business unit and retain its branding, according to a statement from Compass.
Since the start of 2024, Compass’ stock price has more than doubled to $7.14 from $3.54. The stock rose to $7.33 in after hours trading at the time of publication.
Compass earlier this year scooped up Tennessee-based Parks Real Estate and Louisiana-based Latter & Blum. The additions have supercharged its growth in another down year for the residential real estate market.
The brokerage has added nearly 3,000 principal agents from September 2023 to September 2024, with the lion’s share of that driven by its acquisitions.
Compass CEO Robert Reffkin has hinted at the firm’s strong pipeline of acquisition targets in recent earnings calls, saying it would “continue to seek accretive strategic acquisitions.”
Before the pandemic, Compass grew its foothold in high-end markets through a number of deals, including New York’s Stribling & Associates and San Francisco-based Pacific Union International. Last year, Compass added brokerages in Central Texas and Arizona.
Kelli Duncan contributed reporting.