Does anyone think RE/MAX Will go Public?

Real Estate Appraiser with David V. Farrell Co.

I am writing about a subject I touched on briefly in my prior blog, the chance that RE/MAX International, a 100% privately held company, will go public.  My own feeling on this is that they intended to do so before the market crash of the past 2 years. 

 Let's look at the facts:

A company going public likes to a) get its financial affairs in order, and b) acquire as many valuable assets as possible before going public.

RE/MAX International has recently had a rash of purchases of territories that had previously sold to franchisors.  There are only a few reasons I can think of for this.  One, these Franchisors might have reached and age and a position in life where they simply didn't have the interest in continuing management.  They probably made such a fortune that they no longer needed to work.  However, few people would have the wealth to acquire these franchisors other than the master franchisor.  In addition, these regional franchise groups, by way of their agreements with International, cannot go public themselves.  So, they're stuck and, if they want to cash out, International would be their only way to do so.  To me this is a highly likely scenario.

A second possibility is that the franchisors were in financial trouble and needed to be bailed-out.  I would consider this possible, but not likely.

Finally, a very logical reason for the buy-outs would be to have greater assets to bring public.  If Liniger & Co. were able to acquire thes franchises at a relatively low multiple, with the assumption of bringing the company public at a substantially higher multiple, it's a no-brainer.  Further, the overall percentage of franchises directly owned by International, as compared to being in the hands of a variety of smaller players, would be seen as a strong positive in the marketplace.  Further, with ridiculously low costs of funds over the past half decade, these purchases were more than likely highly accretive to earnings.

If you weren't aware of RE/MAX International's numerous acquisitions of regional franchisors, here are some links with articles from different news sources:

RE/MAX International to Acquire RE/MAX of Florida and RE/MAX Carolina Regions.

Publication: PR Newswire
Publication Date: 24-APR-07
Delivery: Immediate Online Access

Article Excerpt
DENVER, April 24 /PRNewswire/ -- An agreement has been reached for RE/MAX International to purchase the independently owned regions of RE/MAX of Florida and RE/MAX Carolina. Together, the two regions will represent an addition of 420 offices and over 10,000 agents to the RE/MAX company owned region operations. Combined with the February acquisition of RE/MAX of California & Hawaii, 2007 will mark the single greatest year of growth for...

These articles are from a pay site for full info.



Wednesday, April 25, 2007  -

Parent company to buy Re/Max of Florida




Publication: San Diego Business Journal
Publication Date: 12-MAR-07
Delivery: Immediate Online Access
Author: Bengtson, Stacey
Company: RE/MAX of Hawaii; RE/MAX of California; RE/MAX International Inc.
Full Article:
Parent Acquires Regional Re/Max Offices: Re/Max of California and Hawaii was acquired by the franchise headquarters of Denver-based Re/Max International. The purchasing agreement for an undisclosed sum was for the 448 independently owned and operated offices and more than 10,000 affiliated agents in California and Hawaii. 



Finally, with respect to getting their financial house in order, "RE/MAX is also becoming compliant with the federal government's Sarbanes-Oxley financial-disclosure law, which is required for publicly-held companies. The company is hiring compliance officers, an outside auditor committee, and is drafting mock Securities and Exchange Commission reports, according to the Denver Post report. "   This is from -

So, what do you think?  While the market is down, RE/MAX International has been acquiring franchisors left-and-right.  Mr. Liniger and his co-founders are also getting up there in years (though they still are probably the most amazing management team in the US today and could teach any group in the world how to run a streamlined company).  What happens if something happens to Dave?  Look at Wendy's (sorry - sick joke).

It is very important to brokers and owners.  For some franchisees, its one reason to renew their franchise when it comes due each five years.  For new franchisees, it is something that should be considered.

Finally, if International does decide to go, who will get what?  While Mr. Liniger has made a fortune off his company, he has created a system that has, by far, helped more Realtors achieve wealth and a good lifestyle than anyone else before him or since. 

Few people recall that, for the most part, women were not agents in the industry before RE/MAX.  People forget that individuals were rarely permitted to promote themselves over the company before RE/MAX.  Other changes spurred on by RE/MAX  go far beyond the scope of this already too lengthy Blog, but RE/MAX has been an innovator for decades.  When will they hold their last private party?  What would you do if you knew they were going public?



Posted by


David V. Farrell, Broker/Owner

Long Island Village Properties

NYS Certified General Appraiser - #46-16371

David V. Farrell Co., Auctioneers & Appraisers

167 Mineola Boulevard

Mineola, New York 11501

p. (516) 741-7350

c. (516) 987-3329


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Tony Fantis
Fantis Group Real Estate - Salt Lake City, UT
Realtor,Principal Broker - Salt Lake City
Very interesting!  I think it may, but I also think it would ruin the company.  Modern business principles have ruined many real estate companies.
Apr 21, 2008 04:48 PM #1
Ray Lopez
RE/MAX Beach & Country - North Myrtle Beach, SC
RE/MAX Real Estate Agent - Myrtle Beach

I just sold my RE/MAX franchise in MN and moved to NC and I only knew about the Carolina purchase...But I had a convo with someone today about how I started a brand new big beautiful High overhead faranchise in 05...about the time Liniger built his brand new office bldg. The money was flying high, and like me...he was probably thinking, why not build something for the future instead of giving all this money away-and we were giving a lot away because we were making a grip!

Now the empire is collapsing around the country-some have shut down, some will have the keys to the front door pryed from their hands. If I were Liniger, I'd sell or go public! Why work a day longer...and why wait until the company bleeds all over the floor?

Liniger always said, We have always grew every month since we opened in '73...even thru the 80's. That claim I'm sure is no longer safe for use. This will be the first time in 35 years they have gone backwards.

I'm guessing RE/MAX has lost around 20% in the N Central Region(MN and WI).

He's a great man, Accomplished the incredible, and should retire in my opinion ON TOP!

Thanks for the post

Apr 21, 2008 05:07 PM #2
David Farrell
David V. Farrell Co. - Garden City, NY
Licensed NY State Real Estate Broker

Ray -

We've lost 10% in NY by my counts - and very, very quickly.  It's scary.  Thanks for the comments.



Apr 21, 2008 05:15 PM #3
Christopher Watters
Watters International Realty - Austin, TX
Austin Realtor (512-829-8000)

It they went public they could raise some serious capital and start buying alotttt more people. I'm not very familiar with the re/max franchise..

Apr 21, 2008 05:17 PM #4
Kelly Winch
Cascades Sotheby's International Realty - Sunriver, OR
Broker, CDPE
Interesting comments, thanks for the info.  I'm new to blogging so I'll keep checking back on this topic
Apr 21, 2008 05:19 PM #5
Frank Jewett
tech4REpros - San Jose, CA

Buy low, sell high.  This is a good time to buy back real estate franchises.  The INTERO founders bought back Mercury's stake in their operation last year.

Apr 21, 2008 06:08 PM #6
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