The memory of getting burned still lingers with D. R. Grempler, head of one of the four largest real estate companies in metropolitan Baltimore.
"We had this happen a long time ago," said Mr. Grempler, president of Coldwell Banker Grempler Realty Inc., recalling an industrious branch manager who left years ago to start his own company, then snatched away the agents he had managed.
The loss prompted the company to institute non-compete contracts, which in some cases bar former managers from competing with the agency for six months. But the loss didn't stop Mr. Grempler from swooping in on his own competitors to siphon off their best agents. He's especially proud of those gained from some of the bigger competitors.
"We've done a fairly good job of recruiting from some of these agencies in the last 60 days, and we're working on the smaller brokers, taking their agents," Mr. Grempler said.
All's fair, it seems, in the battle of the agencies, especially the four top ones in metropolitan Baltimore -- O'Conor, Piper & Flynn, Long & Foster Real Estate Inc., Coldwell Banker Grempler and The Prudential Preferred Properties.
For them, victories are measured in agents recruited, offices acquired and gains in market share, all of which translates into improved sales figures and ultimate survival.
And in an industry becoming ever more complex, revolutionized by new regulations and technology, agents say their choice of agency has become a matter of survival as well.
A glaring example of maneuvering between companies and agents occurred early this month when 45 agents left Prudential's Pikesville office for two competitors, O'Conor, Piper & Flynn and Long & Foster, ranked first and second.
By all accounts, Long & Foster instigated the exodus by luring the manager of the $100-million-sales-producing office to head Long & Foster's months-old Greenspring office. The Pikesville branch is now closed.
"We've been working a long time to catch OPF, and we're trying very hard to do that," said Alice Burch, Long & Foster's Baltimore regional manager.
"This should boost our market share considerably, at least in Baltimore, and it should increase in the region, too."
In some cases, the fight to the top is spurred by a drive to regain a lost position; in others, to maintain a hard-fought spot.
There was a time when Mr. Grempler's family ran the biggest agency around. Over the years, competing brokers had grown through mergers and by luring agents with bigger splits of sales commissions; Grempler foundered. Then, a year ago, 33-year-old Grempler Realty bought Coldwell Banker's eight Baltimore-area offices, doubling its market share to 15 percent and increasing its agents to about 1,000.
Before making the move, Mr. Grempler said, "It was getting more and more difficult to compete and tougher to make a profit. Now, whatever the competition does, we match it and then figure out how to make it work."
And there was a time when O'Conor, Piper & Flynn's sales didn't dominate the marketplace. Ten years ago, James P. O'Conor, then an executive of O'Conor, Flynn & Skirven Inc., watched national companies such as Merrill Lynch and Coldwell Banker descend on Baltimore, for years a patchwork of local brokers who had carved out geographic niches.
"My company was a medium-sized company and we felt threatened," said Mr. O'Conor, who merged his company with four others to become the biggest home seller in the Baltimore region, a coveted spot the firm has retained by merging with or acquiring 32 other companies since then.
"There were a lot of skeptics who didn't think it would work -- five companies with five different owners and five different ways of doing business," he recalled. "Now, it's almost getting to the point where it's big or small and not many midsized left."
Agents say it has become crucial to hook up with agencies that have the financial stability and muscle to offer the training, advertising and name recognition that they say can clinch a sale.
Even with experience managing residential and commercial properties in Manhattan, real estate agent Steve Nash felt lost when he joined a small Baltimore company with four agents.
"I needed to have a full-time manager who I could bring all my concerns to, whether they be legal or contract situations," said -- Mr. Nash, adding that he gets that support with Prudential Preferred Properties.
"Real estate now is very much involved, and one needs to be aware of all the legal ramifications," he said.
"When you're working as an independent contractor, you don't have all these resources at your fingertips."
Agents and managers named resources and backing -- training, administrative support and widespread advertising of their properties -- and a company's financial growth as major hooks in drawing them from one company to another, even more so than salary. Typically, agents new to the business split sales commissions with a broker, then proceed up a commission schedule ladder, earning higher percentages as they sell more homes.
Prudential Chairman Ray Chappell said that he and his four partners hope to increase training in new technology that will allow agents to work as easily from their cars and homes as from an office. For instance, the company is shifting to a new telephone advertising hot line and automated phone service linking callers directly with agents.
The partners, who own a mid-Atlantic franchise with 70 branch offices and 2,500 agents in five states, expect to maintain some large, fully staffed branch offices, where agents can meet clients, but they also anticipate a need for fewer offices as agents become more automated.
To make such changes and increase efficiency, the firm will need to reduce its print advertising and support staff, Mr. Chappell said.
The company was especially concerned with cutting expenses at its Pikesville office, the only branch in which the company was losing money, he said.
Former agents described that office as being full of "heavy hitter" agents, with high sales volume but also high commission splits.
When the company outlined its plans, Mr. Chappell said, "many of the people were open to the ideas, but when the manager left, it just snowballed, and it seemed the competition was there to court [agents] and had convenient nearby locations, and they went."
Agents didn't view the company's new direction in as visionary a manner as the owners would have liked. What they heard was "we need to fix this," one agent said. "The problem with that thinking is O'Conor, Piper & Flynn and Long & Foster didn't need to fix it." Commission splits were not a factor, agents and managers said.
Joan Solomon, who for four years had run the Pikesville office, said she accepted the offer from Long & Foster because "it appeared to be the company to reckon with or be with."
'Tough market out there'
"It's a tough market out there and managers and agents need all the support they can get to be successful," she said, noting that the company's entire package of benefits impressed her. For example, there is a department that will personalize agents' marketing plans and the company's advertising television program.
After she left, she said, 20 agents followed her to the Long & Foster Greenspring office, 11 moved to Long & Foster in Pikesville and 14 went to O'Conor, Piper & Flynn in Owings Mills.
Kathy Correll, manager of the Owings Mills office for O'Conor, Piper & Flynn, viewed the migration as a continuation of one that started four years ago, when she left a management job with Prudential. Since then, 35 agents, including the recent 14, have moved to her office, she said.
Ms. Correll left because "OPF had more services to offer and more market share," she said. "Market share is important and services to agents, like advertising. I need to be able to sell a company to agents. The [new] agents came to us because of reputation and strength in the marketplace."
Effect on Prudential
Mr. Chappell said he doesn't view the loss of the agents as a
serious blow.
"Even though you hate to see fine people leave, on the other hand, we pick up many, and that's the nature of the business," he said. "In no way will it have a traumatic effect on the company or be devastating in any way. It doesn't in any way jeopardize the Baltimore division or threaten its viability."
The maneuvering among three of the agencies hasn't left Grempler, ranked No. 3 last year, sitting idly.
"Long and Foster and Prudential have been having a real slugfest lately," said Mr. Grempler, who first got wind of Prudential's loss in Pikesville when he spied a Long & Foster moving truck. "It came down so fast. We tried to jump on the bandwagon and get as many [agents] as we could."
But while he said that he has been able to recruit dozens of agents new to the business to work in his 20 offices, he didn't have the same luck wooing Prudential agents.
"There was a group who refused to leave Pikesville, and I don't have an office in Pikesville," Mr. Grempler said.