Luxury real estate brand Sotheby’s International Realty Canada (SIRC) has been sold by a subsidiary of Dundee Corp. to Toronto-based Peerage Realty Partners Inc., expanding the stable of high-end brands the company controls. No financial details were disclosed, but the deal is set to close May 17.
“It’s been on the wish-list for a very long time, we’re looking for non-replicable companies and there are only so many,” said Gavin Swartzman, CEO of Peerage Realty Partners.
Since 2007, Peerage has been collecting and expanding luxury real estate brands, and has amassed more than 1,840 sales representatives in 72 offices in North America, and claims it is transacting close to $13-billion in sales.
The deal will affect SIRC’s 540 realtors in 32 offices across the country (transacting an estimated $5-billion in annual sales), who will be given the opportunity to stay with the brokerage. SIRC is the sole franchise in Canada for the venerable auction house’s international realty brand, which has 990 offices in 72 countries around the world.
Dundee Corp. acquired the Sotheby’s franchise in 2012 through a subsidiary under the direction of Dundee founder Ned Goodman, who has since retired. At the time, the company hoped to expand the team of 300 agents to 1,500 agents.
“We know the people at Dundee quite well, they have been divesting a number of non-core businesses – in our asset management division we acquired two companies from them – and that put us in a position to have a dialogue that ultimately culminated in this deal,” said Mr. Swartzman.
Like the rest of Peerage’s brands, the Sotheby’s franchise will be run independently, but in this case it will get a new CEO in Peerage executive Don Kottick, an industry veteran who was previously been a director at the Canadian Real Estate Association, president of the Real Estate Institute of Canada and a director of the Toronto Real Estate Board.
“This is the most coveted and highest profile and most-talked-about real estate brand in the world,” said Mr. Kottick. “We believe there’s a lot of untapped potential for growth here, we’ll be looking to add new products and services and ways to conduct business more efficiently.”
In January, Peerage acquired Denver-based boutique brokerage Madison & Cos. Properties LLC, part of a buying spree the company has planned in the United States for which it has allocated $250-million.
Peerage Realty was formed in 2007 by private equity firm Peerage Capital; the first brands it acquired were luxury-focused Chestnut Park Real Estate Ltd. and condo pre-sales specialists Baker Real Estate Inc. In 2016 it added British Columbia’s Fifth Avenue Real Estate Marketing Ltd. and in 2017 added midmarket brand StreetCity Realty Inc.
Peerage Capital’s executive chairman is Miles Nadal, who was also the founder and former CEO of advertising firm MDC Partners Inc., from which he resigned in 2015. In 2016, he paid a US$1.5-million fine relating to compensation and expenses at MDC as part of a settlement with the U.S. Securities and Exchange Commission. In 2018, the Ontario Securities Commission barred the financier from serving as a director or officer of any Ontario public company until May, 2022.
Shane Dingman