Karl Popow
Karl Popow recently launched LBridge Realty Corporation, a new commercial real estate brokerage in Toronto. Popow says the company is offering commercial Realtors “all of the benefits that are now enjoyed by residential agents, and more… more choice, personal empowerment, better financial incentives and more professionalism.”
Popow says the inspiration for the concept came from Re/Max founder Dave Liniger. When Liniger launched Re/Max, says Popow, he “issued a challenge to the standards in the industry (50/50 split) by letting agents keep 100 per cent of their commissions in exchange for a small fee for services provided by the new Re/Max brokerage for office and desk space, tools, administrative support and brand advertising.
“The philosophy behind this aggressive and industry-changing proposition was the realization that the agent’s personal skill and hard work at finding clients and servicing their needs was in fact the key factor for success, and when an agent was faced with giving up 50 per cent of the reward for their effort, it became a de-motivating factor.”
Popow says firms such as Charles Rutenberg Realty, originally of Chicago, and Right At Home Realty in Toronto “have taken the revolution started by Re/Max one step further by reducing fees charged under the Re/Max system to ‘bare-bones’ levels. Their revised platform is simple… in exchange for a smaller fee, they provide the basic essentials (deal processing, front desk support, training) and the agent sources any other tools and services required (office space, assistant, signs, administrative support). This second wave of change in residential real estate, represented by just these two companies alone has grown to an estimated 5,000 agents in just a few years.”
Now Popow says he is taking the concept and applying it to his commercial real estate brokerage.
“I worked for a large commercial brokerage and soon realized that the business that I had dug up was the result of my own hard work and efforts, and the resulting clients were loyal to me and not to the company,” he says. “I had become self-sufficient in many ways (analyses, presentations, offer preparation, use of technology tools) and resented having to pay, via a 50/50 split, for full support capabilities and senior executive-level relationships established over time that I didn’t need or utilize. I found that all the tools and services that I needed to conduct my business properly (executive office and meeting facilities, research, presentation materials and signs) were readily available ‘a la carte’ and at a reasonable price.”
Popow says the recent re-launch of Royal LePage’s commercial division “proves my earlier point that commercial real estate is evolving just as residential real estate evolved. However, I think of LBridge as an even better ‘second-wave’ commercial brokerage. Not only did I work for one of the large commercial brokerages, but I was also quite successful in conducting my commercial real estate activity under the Re/Max banner for quite some time. During that time I was able to identify several expensive services that I did not require and that I was reluctant to pay for each month. This fixed overhead has been eliminated within the LBridge model, with the result that splits may be more favourable than even those offered by residential brokerages.”
He admits that while this “new thinking” may scare off some commercial Realtors, “others may be intrigued by a new and ‘folksy’ sense of professionalism and may be interested in getting in on the ground floor. Time will tell,” Popow says.
