US real estate agency seeks foothold in market

HONG KONG: Texas-based real estate agency Keller Williams Worldwide plans to establish a foothold in Hong Kong by selling a franchise to an individual investor to operate agencies under its brand.

Chris Heller, chief executive of Keller Williams, said he was aware that Hong Kong's property broking market was competitive. Two local players — Centaline Property Agency and Midland Realty — control more than 60% of the market.

But the absence to date of a major international player in the market has not deterred Heller, who believes his agency can beat the odds.

The key to success, he says, is people. "We can attract the top local agents as they can earn more money in our market centres."

Founded in 1986, Keller Williams now has 8,400 agents and is the No 2 real estate company in the US in terms of the number of agents.

"We have the best model in the industry, largely due to our unique profit-sharing arrangement, along with the best of breed training tools and systems to empower agents," he said. Each office is independently owned and operated by ownership group franchisees.

Keller Williams envisages setting up three "market centres" (branches) in Hong Kong, each with 30 to 40 agents.

"50% of the net profit in the centre will be shared with the agents," said Heller, who said he had already signed a Memorandum of Understanding with an investor who will acquire a licence to operate all the centres in Hong Kong. He expects the market centres to be up and running in Hong Kong by September.

Keller Williams is also targeting the mainland market. "We will be granting the right partner the master licensing rights for the region, with the expectation that they will sub-licence it throughout the territory."

Kenny Lo, general manager of Intero HK, a unit of US property agency Intero Real Estate Services, applauded Keller Williams's courage. Intero failed in its attempt to seek a Hong Kong partner to operate under a franchise agreement and open agencies.

Lo said international agencies would find the local market challenging "in the sense that all outside agencies have to learn the local ways of doing business. The process will take serious commitment in terms of time, effort and means". — SCMP