As 2021 came to a close, Thad Wong and the company he founded with Mike Golden more than 20 years ago—Chicago-based @properties—made a giant leap forward with the acquisition of the Christie’s International Real Estate brand and network. The acquisition was soon followed by two additional power moves: the sale of the Christie’s company-owned Manhattan brokerage to Brown Harris Stevens, and the rebranding of the company as @properties Christie’s International Real Estate.
According to Wong, the Christie’s deal creates a compelling alliance, combining the technology acumen and independent brokerage expertise of @properties with a 250-year-old global, luxury brand. In this exclusive interview with Wong, RISMedia Founder & CEO John Featherston and I get a behind-the-scenes look at how the deal came together, what it means for the future of @properties and what’s in store for real estate brokerage at large.
Maria Patterson: Let’s begin with the Christie’s International Real Estate acquisition. Tell us a bit about the backstory.
Thad Wong: We viewed the Christie’s partnership as the greatest listing presentation we’d ever been on. It was a very competitive, sought-after relationship and brand, so we did everything that the best agency would do. We created a full, physical presentation of what our marketing materials would look like with the Christie’s brand. We were presenting to people in London and in Paris, so we had custom boxes sent to each board member, and in them, was our physical listing presentation.
MP: With your technology prowess, why did you opt to send a physical presentation?
TW: I’m still a big believer in physical presentation. Physical is still a way of expressing the quality of your brand to the consumer, so we created leather briefcases and leather folios for our listing presentation for Christie’s. We also created a beautiful video that went over the entire history of Christie’s. We wove in the benefit of @properties—our value proposition, which is our technology, our marketing, our training and coaching, our culture and the credibility of our reputation. You’ve got great brands out there, but none of them are being run by true brokerage companies.
John Featherston: So your history as an independent brokerage was a big factor in winning this deal…
TW: I’m a big believer that the independent operator will always win in a local market because of their understanding of their market, their relationships and connections with their agents, and because they’ve got real skin in the game, real ownership interest. And a lot of pressure has been put on them over the last five years, especially from Compass and the VC dollars that have come into the industry. Our technology is the best tech in real estate. We’ve built all of our own technology and it’s fully integrated. (Christie’s) saw that we had a tech solution and they saw our physical, and more importantly our digital, listing presentation; and then we went over our training and coaching, which is a big part of culture. Then they researched our reputation. And that’s how we won.
MP: How confident were you that the deal would happen?
TW: We were an underdog, in my opinion. But I thought, ‘Okay, if we put everything we’ve got into getting this deal, we will improve in every category, so I’m prepared not to get it.’ It reminded me of a listing I was trying to get in 2004-2005. We flew halfway around the country and did all these things to get the listing, and we didn’t get the listing. But we learned a lot about ourselves. So that’s the way I was approaching this. But I did say, we’re going to put all of our effort in.
JF: What made your firm a compelling proposition for Christie’s?
TW: Christie’s was trying to achieve a stronger international network. We explained to them the challenges within the industry—the challenges that independent operators have, their compressed margins—and we said, we can empower the best independents in North America; we can give them a plug-and-play value proposition that includes a fabulous brand that immediately identifies with luxury. We’ve got a two-year road map for our technology that we showed them. If we can give these independents the ability to plug into us, take the brand, take the tech, take the marketing, training and coaching, they can have a $20 billion infrastructure. And we speak the same language because we’re still operating a brokerage. There’s no broker I can call who’s not struggling with something that I’m also struggling with, and so there’s a lot of alignment, a lot of empathy, a lot of connection.
MP: How long can you continue to say, “Hey, I’m an independent who understands the independent broker’s struggles.” Will you become too big for that?
TW: First of all, you’d hope so, right? I guess that’s always the goal. But I don’t see that happening in my lifetime. We are not going to be Realogy in that sense. Our goal is to grow the network and really support the independents. I wear two hats: I wear my @properties hat and my Christie’s network hat, and I think I need to wear both in order to remain relevant to the client. The client is an independent broker, and if I’m not experiencing and operating the same way then I’m not as valuable to them as an ally, as a colleague. So, I don’t think I have to remove myself from @properties in order to do this. I still want to be agent-facing and come up with ideas that can improve the brokerage, because everything that we’re doing to improve @properties in Chicago is going to be airlifted and then applied to our affiliate partners. I think it would be a shame if I stopped doing that because I am super involved in the brokerage and we have a lot of ideas.
MP: Why is staying innovative so critical, and how do you measure its success?
TW: I’m a big believer in math. I like seeing adoption percentages and likelihood of conversion and increased followers. We’re telling our agents that if you don’t provide more value to the customer every single year, you can’t charge them the same rate. You just can’t. The way it’s going right now, you either have to charge less or provide more. And that’s the same thing for brokers. A brokerage has to continue to provide more resources to the agent to support their business. So we need to continue building our brokerage at @properties and that will help us to continue to scale it and offer those ideas and those solutions to our affiliates. And that is the goal: to build the strongest luxury network in the world. But in order to do that, it can’t just be a brand—it has to be infrastructure.
MP: One of the cornerstones of your company is its culture—how do you plan on maintaining this focus as the company expands?
TW: One of the most important things that we can offer our affiliates is our own experience as brokerage company operators. Other networks and franchisors cannot give their constituents the same insights or expertise, the same granular level of problem solving, because they are not running a brokerage firm. And that gives us a huge advantage as we expand. There are a lot of great operators in our network, and we can learn from them too, so it flows both ways. But the point is it’s critical for us to stay in the game. We want to stay in the game. Because continuing to develop the marketing, the tech, the culture that makes us a successful, profitable, market-leading brokerage will only help us provide more value for our affiliates.
JF: What’s the next step for your own growth within @properties?
TW: It took us a really long time to build the No. 1 luxury brand within the Chicago region, so we are going to lean heavily into Christie’s to expand that, to be dominant in that, and I think the brand addition was needed because @properties doesn’t lend itself easily to a luxury brand. It’s tech, and tech isn’t always luxury. It’s functionality, it’s efficiency, it’s not Hermès. By adding this piece to it, we’ll be promoting a lot of the auction items alongside homes to make the branding, marketing and content of real estate far more interesting. So, if you can imagine a crocodile Birkin bag alongside a co-op facing Lake Shore Drive—a new, modern condo alongside a Beeple NFT. Things like that to engage with the customer more.
Locally here, we have a huge amount of focus on growing our numbers in new markets. There are not that many new markets for us to go into in the Chicagoland area, but there’s a few, and so every year we’ll be opening a couple new offices. But probably the hardest job is maintenance rather than growth. We have to figure out every day how we help each one of our agents feel valued by the organization, so they feel valued as we grow. And that’s the greatest challenge we’ve ever had and it will still be our greatest challenge. If we can figure out how to get 3,500 agents to feel valued here, we can then help other independents.
JF: Given the competition in the industry right now from the so-called “disruptors” and VC firms, what are you doing to retain your agents?
TW: The thing (these firms) don’t offer is a value proposition to the consumer. What we learned is that when you only create a value proposition for the agent, you do not succeed in high net-worth areas. So they’re creating a magnet for agents who want to have their costs as low as possible so they can make as much money as possible. Those guys have done great at that. But you have to pick who’s your competition and who’s not your competition—they’re not my competition. I’m not making decisions based on what they’re doing.
MP: How has your approach to recruiting and retention changed in pandemic times? What matters most to agents now?
TW: You know, it’s funny. We actually just conducted a technology survey of our agents. And when we asked the question, ‘What initially attracted you to @properties?’ technology ranked 4th behind reputation, culture and marketing. The industry is so focused on tech today, and companies have forgotten about relationships. It’s a never-ending battle, because the good agents are always getting recruited, but the companies that focus on relationships are the ones that are going to win. The pandemic forced us to get really creative, and I’m grateful because our team has done an incredible job. We’ve developed a lot of successful programs—both virtual and in-person—around recruiting and especially retention. And it has helped make our culture stronger than ever. And when your agents are loving your culture, that is the best recruiting tool you can possibly have.
MP: In your opinion, what are the most daunting challenges facing brokers in the year ahead? Conversely, where does the greatest opportunity for business lie?
TW: For the independent broker, I think the most daunting challenge is finding that solution that’s going to enable them to compete with the goliaths of the industry. Indies are getting squeezed from both sides. You’ve got margin compression from higher commissions, and then you’ve got the costs of providing operational solutions—primarily tech, but also marketing and other things—that are essential to agents running their business. That requires a ton of scale, and even then, there’s no guarantee you’ll get it right. But I think we’re coming into a moment where an independent broker can plug into a solution—not just ours, although we obviously love ours—and stand toe-to-toe with the corporate brokerages and come out on top. So the greatest challenge is also the greatest opportunity. And when this market turns—and it always does—there’s going to be tremendous pressure on the publicly-owned brokers to make moves that appease investors on quarterly earnings calls but that aren’t going to sit well with agents. And that’s when well-positioned indies stand to regain a lot of market share.
Maria Patterson is RISMedia’s executive editor. Email her with your real estate news ideas, maria@rismedia.com.
