Yet another indication that the old school real estate franchise business is not what it used to be is the selling of Prudential Real Estate’s franchise business to a Canadian company, Brookfield Residential Services, for $110M. Brookfield purchased GMAC Real Estate in 2008 and most of those franchises changed their name Real Living. The press release didn’t say when Prudential franchises will be changing their name.
With franchise real estate, a portion of the commissions paid are sent to the parent company (the franchisor), typically 6-8%, for the use of the name. When something like this happens, it’s unclear what the benefits are if the name is not well known in the community where the homes are being sold.