Whole adult lives are spent building sales careers and the real estate industry is no exception.
That right combination of knowing how to forge relationships, form loyalties, problem solve, structure alliances, shape your reputation, hustle, toil against adversity, drum up new business, stick-to-it and work damned hard requires an almost indescribable finesse. The successful ones have it.
But time marches on and then, in what seems like the blink of an eye, it’s time to retire. Do you just walk away into the sunset? What happens to that book of business you’ve worked so hard to build? Does it just fall away like a house of cards? And what happens to your sense of purpose and identity, not to mention other important hallmarks such as social interaction and intellectual stimulation?
Alba DiPlacido and her long-time sales partner Adele Longo grappled with these questions. They were each in their 60s with long successful careers under their belts when they decided the time was right to do something about this phase of life that ultimately affects all Realtors who stay in the business long enough.
“Here we are with decades of experience and a tremendously loyal clientele. It seemed wrong on all counts to just walk away from all of that,” says DiPlacido, 64, who with 69-year-old Longo, decided to devise their own exit strategy.
With no pension plan, the pair understandably wanted compensation before handing off the business they worked so hard to build. But their succession plan is about much more than just money. Equally important was their desire to leave behind a legacy that showcased their shared professional values.
“We wanted to introduce our clients to someone who treated them with the same high level of personalized service,” says DiPlacido, who works with Royal LePage Your Community Realty in Richmond Hill, Ont. “We prided ourselves on our integrity and hard work. Yes, it’s easy to find a real estate agent, but are you finding one that you have confidence and trust in? The other piece that’s truly important is that it’s hard to walk away from a business that does really well. If you walk away you get zero.”
Their quest to find suitable replacements began at the start of 2016. They considered eight potential successors and ended up interviewing three, whose business values most aligned with theirs. Each was asked to prepare and present a reasonable model for a succession plan, showing how the merger should take place. Each presentation was outstanding.
Ironically, DiPlacido and Longo had discussed not selecting agents with Italian backgrounds simply for a change of pace, as both of them have Italian backgrounds. But in the end, that did not happen as the husband-and-wife team of Frank and Laura Cormaggi, who work out of the same brokerage as DiPlacido and Longo, were selected – thanks in large part to their shared values and personal approach to working with clients.
The transition is expected to take two to three years. The team’s succession formula includes a percentage on the listing side that goes to the Cormaggis, who are responsible for marketing costs and interaction with the sellers.
The buyers for the most part are managed by Frank Cormaggi, who is the buyer specialist. The formula is capped in the first year at a certain dollar value as are the marketing expenses. In the second year, the formula shifts more in the Cormaggis’ favour until DiPlacido and Longo completely leave the business, at which point the formula shifts completely in their favour. As long as DiPlacido and Longo keep their real estate licenses active, they are entitled to referral fees or what DiPlacido calls a type of pension plan.
True partners who share everything 50-50 and have done so without aid of a written contract, DiPlacido and Longo started what would become a successful and enduring partnership in 1996 after having already established solo careers in real estate. DiPlacido managed a highly successful Royal LePage corporate office for nine years in the Markham/Unionville area, while Longo worked 16 years as a real estate salesperson in Richmond Hill.
The two have become good friends, engaging with each other’s families and friends, being there for each other during times of sorrow and celebration. The partnership works, says DiPlacido, because each recognizes the other’s strengths. Longo is detail oriented and well organized whereas DiPlacido is more the big-picture person – warm, chatty and intuitive.
“In a good partnership you encourage the other person to work harder,” she says. “We inspire each other to achieve, to go above and beyond. Like yin and yang, we’re cohesive and easy together.”
Since the January announcement of the merger, DiPlacido and Longo have each received a good number of inquiries from other senior real estate professionals interested in the details of their transition. Based on their research when they began this process, information on succession planning for salespeople appears to be in short supply.
“I searched out seminars, looking for expertise,” says DiPlacido. “We wanted to find a model for what we were doing. There was nothing in the industry I could find. So when the announcement went out, it got a fair bit of interest.”
Kelly Putter is a contributing writer for REM.
