By Mario Toneguzzi

Shami Sandhu
Shami Sandhu

Realty One Group, an established U.S. real estate brand, is aiming to expand aggressively across Western Canada.

Shami Sandhu, formerly broker at Re/Max River City in Edmonton, has secured the rights to Realty One Group of Western Canada and plans to expand the brand to as many markets as possible in Manitoba, Saskatchewan, Alberta and British Columbia.



“We’re willing to look at every market out there.  As well as the larger markets, I’ve recently been contacted from markets like Wetaskiwin and Leduc (in Alberta). I’ve had people contact me from Nanaimo, Fort McMurray and Brandon, Man.,” says Sandhu.

He says in the major markets, “my intent is to have about one office for roughly every thousand agents that are registered with the local real estate board. So for example, Edmonton’s got roughly 3,800 registered real estate agents so we’re going to have close to four offices in the Edmonton area.”

He says interest in the brokerage is very strong from two main groups – independent brokerages that see the value of affiliating with Realty One Group to grow their business, and real estate teams, who are now looking at taking their business to the next level by starting up a brokerage.

Sandhu has over 15 years of industry experience and was previously awarded Broker/Owner of the Year by Re/Max of Western Canada.

Vinnie Tracey
Vinnie Tracey

“The success of a franchise system is having the right concept and the right partner,” says Vinnie Tracey, president of Realty One Group Affiliates in Irvine, Calif. “I have known Shami Sandhu personally for 10 years. He has the pedigree, knowledge, work ethic and respect of the real estate community to make Realty One Group a major player in Western Canada.”

Sandhu says no one has disrupted the Canadian real estate market in 35 years but it’s time for a new disruptor.

“I believe Realty One Group will be very well received just like they have proven to be in the U.S. I want to show the Canadian real estate industry what we need and to remind them that it’s our agents that truly drive this business and the focus needs to be on them,” he says.

“While most of the industry is focusing on promoting themselves and shareholder value, Realty One Group maintains its focus on technology, corporate culture and a you-first focus to serving their associates.”

Sandhu says what differentiates Realty One is that it’s a 100 per cent company, meaning that its agents don’t pay a commission split. They pay a flat fee monthly or a flat fee per transaction.

“Where we’re different from the other companies in Canada, especially, is two main areas. One is corporate culture. Our organization is all about everyone having a voice. Everyone’s an equal participant in our organization. The agents are finding out what’s happening with the company the same time the broker owners are. They’re encouraged to provide feedback to the company,” says Sandhu. “We’ve been described as being very Silicon Valley, Google-esque in a way in our approach.

“A big foundation of ours is supporting collaboration and it’s all about working together. It’s not about competing against one another…there’s a lot of business out there to be had. That translates to our office design. A key element in many of our offices is the One Cafe. So instead of having an office full of 20 private offices, for example, most of our offices have fewer private offices and more of a cafe-style space – more of a collaborative space where agents get to work together and learn from one another.”

Another key point about the brand, says Sandhu, is the level of support it provides agents through tools and resources.

Realty One Group was founded in 2005 in the U.S. by owner and CEO Kuba Jewgieniew, a former stockbroker.

13 COMMENTS

  1. Thanks for getting back to me Shami, I do have a few questions, are you a franchise operation or corporately owned? If a franchise, then a percentage must to go to the parent company in the USA, a percentage goes to you as regional owner, then a percentage goes to the franchisee…A monthly fee and a transactions is not a big number…I estimate that you need hundreds of agents just to breakeven without even paying the head office, the regional and then the owner….Say you have 200 agents paying $89 per month and the average agent does 4 deals (the actual average is lower), That works out to 89 X 200 X 12 = $213,600, then 3X200X 350 per trans = 210,000, grand total of $423,600 revenue for the year. Rent = 80,000, 3 staff = 100,000, general expenses= 50,000, Advertising=100,000, so total expenses = $330,000. Grand profit of $93,600. From this grand profit you must pay head office their share, say $25,000 (probably much higher), then pay regional say another $20,000 (probably is higher) then the owner gets to keep $48,600 if lucky…that is with 200 agents…at 100 agents he loses money….let me know where the flaws are in this thinking?

    • Bruce, I appreciate your attempt at making assumptions on income and expenses of our Brokerages. Each office is independently owned and operated and free to charge whatever they want based on their own financial models. We continue to prove our model with every one of our 150+ offices. If you would like to contact me for a detailed explanation please do so at 780-701-2500.

      Shami Sandhu
      Realty ONE Group of Western Canada

    • The numbers do work, this platform attracts agents so it is not hard to add agents to an office.

      Your numbers are a bit off, breakeven point is low, and is attained fairly quickly. 25 to 50 agents is breakeven if the broker follows the plan.

      Most brokerage are fat, and have too much waste, and there is a growing number of agents who see that, and are tired of paying for it.

      ONE is not for everyone, there are many great brands, franchise or independent, but Shami and I do feel this is right for some owners and agents.

    • In the late 1980’s as I approached the ten-year mark in my career, I had been courted by franchises. I was on a 50:50 corp office split that went to 60:40. It cost me plus or minus 250k approx. annually to be there. No one ever heard me complain. I wasn’t greedy. Later I was told my earnings contributed in the range of a hundred thousand towards the manager’s pay taken from the corporate portion, or nearly paid the office mall-office lease.

      But I understood the system, the costs involved that the H/O corp had to have in order to stay in business. And they treated our top 10 regional area reps like royalty, so the gross to the top 10 agents was actually supplemented making it higher at the end of the year, including air travel first class across the country. (All taxable benefits. Some years I paid tax on more than 16k just in benefits.)
      But it was a strong base of business head office admin with good people at the helm.

      Having said that, they weren’t franchised at that time; only corporately owned offices coast to coast Canada. The system worked. I don’t know how it works now because I left in 1991.

      But I did interview the inviting franchises. I wanted to learn how they operated. I was forever being recruited to join various 100% offices, but always courteously declined. And appreciated the offers.

      And when I evaluated the income statements of sample franchise offices, I was shocked to see that as a mere salesman, my own existing numbers were more than 4 x’s the bottom line for a whole sample branch. It was an earth-shattering observation. I was truly shocked. The salespeople at franchises were the money earners, not the franchise branch owners. It’s a topic not often talked about, and certainly agents don’t care. Why should they?

      It was a major wake-up call that suddenly screamed at me that for less than 250k, my approx gross on the 50:50:60 system, I could run my own boutique corp (then unheard of in my trading area), and still have 250k gross for me.

      I had never entertained leaving the corp but strange things began to happen at branch level that head office closed their eyes to. So, ever so sadly, the time had come, I was nearly fifty years old and starting a whole new venture.

      I took a real chance, but knowing if it didn’t pan out, I could always get a job in sales. But I maintained my 24% personal market share as I moved forward, much to the surprise of many.

      I had been in an (unacknowledged) abusive controlled marriage for about 25 years at the time and my ex-husband “allowed” me to open my own company, saying: “I give you a year to experiment. If it doesn’t work you will have to shut it down. I can’t allow you to jeopardize our future wasting all the money you’ve earned.” Really.

      He had no signing authority or input at my business. Fortunately for me at the time unlicensed spouses could not participate in a real estate company ownership. There should be perhaps a lesson there for someone. For the next nearly twenty years, from 1991, I was married to my boutique corp.

      And we were knee deep in a recession when I opened shop in 1991. Within three weeks of leaving, I was up and operating with my first open for business announcement. My first transaction to close was a million dollar property at full commission, but it’s not true that I only sold million dollar properties. (I don’t understand something on your site referencing you are the largest 1% commission company.)

      The talk on the street in 1991 was: “is she stark raving stir crazy; she won’t last six months.” That was 1991, nearly 30 years ago. For the next 25 years I continued to be a leader in the industry, as a lone operator. So that just proves there’s room for all sorts of business applications. The current talk about agents forming businesses within businesses might not be exactly as expressed. Only if the agents have “a head for running a business.” How many of those do, and not still rely on the brokerage owner to pick up the business-smarts slack.

      Due to a recent family cancer situation, I elected to put my business and licence on hold a couple of years ago. But for 25 years beyond 1991, I had never looked back. It all was tremendously gratifying when local franchise offices were sometimes losing a sales rep, to learn they had been told to contact me to see if I could bring them to life in sales; perhaps discover whatever my secret to success was. I didn’t know I had one. My power was in my branding. And my personal given name was my brand. I wasn’t looking to recruit agents. I would have been a terrible recruiter. We have to know out strengths and weaknesses.

      But not all agents think like business people. And they don’t take into consideration the numbers in the pyramidal franchise structure that another comment here on REM made an effort at breaking down. And even that breakdown didn’t address the cost of babysitting hundreds of agents, only to gross, not net, 40k something. Even if that number were double, very hard to see through the veil.

      Somebody is in for a very big surprise perhaps, sadly, here in Canada. I have many American connections throughout the States, and business there is conducted so very differently. Agents there carry a much heavier responsibility load.

      I wish these new people well, and welcome to our country, because getting rich obviously isn’t their motivator, when all the items noted are considered. The cost of mechanization is gigantic and each individual office nearly needs an on-staff tech person. And that doesn’t speak to hardware costs and need for constant upgrades.

      There’s room for everybody, and sometimes a philosophy change can indeed be a breath of fresh air to the industry masses. Long days, long nights, incessant monitoring people who always want more and have their hands in your pocket. Nonetheless, I do wish them well.

      Surely they will understand the need for charts and graphs, and the importance of bell curves and algorithms pertinent to the individual domiciles, not just the overall franchise master system, even if the agents don’t know or care because their only goal is what’s in it for them; why would they be interested in any bottom line but their own; that’s human nature.

      They only want to buy and sell houses for clients, often not recognizing their own bottom line is diminishing in the overall. They mostly wouldn’t know a bottom line if it bit them. And quite simply they don’t care. Not part of their job description. The brokerage will deal with it all. Certainly doesn’t apply to all, but to a substantial number.

      The ownership responsibility for any organization in the industry is huge and the ROI mostly not so much.

      Just a small suggestion re the corporate website promo material: “ca” stands for California as well as for Canada. So that alone can be easily misunderstood. And word spellings in Canada mostly don’t follow the American dictionary. So in such references, using the words “neighbor,” and “honor” among others not spelled with a “u” as in neighbour, and honour might offend some Canadian homeowners. Of course, others not.

      Not criticizing, just commenting. Some Canadians are very sensitive to this, and some newspapers follow only Canadian spellings. There’s so many variations of the so-called English language. The linguistics history is fascinating.

      I had the pleasure of helping edit a work out of Simon Fraser University in B.C. many years ago, ultimately titled “Our Own Voice,” wherein language variables coast to coast just in Canada, were fascinating: creek, brook, stream, or slough? What is the waterway called where you live?

      The whole language topic must confuse immigrants, and I sometimes wonder how spellings are now marked on schoolwork with the advent of the computer world. Often teachers themselves don’t spell well. And have such a high load of responsibility otherwise. Maybe no one cares, thus a moot point. Spellcheck has a default to American spellings.

      Respectfully,
      Carolyne L 🍁

      • Hey Carolyn! Thank-you so much for sharing your experiences since your start in the late-80s. Our business, as most others, has changed so much over the years. The costs of doing business has changed as has the technology.

        Our company has helped agents put more money back in their pockets, created an amazing environment for them to learn and work and also provided them with better tools to make them and their offices more efficient.

        We salute you for being a trailblazer in the 1991 and doing something different. We share the same entrepreneurial spirit you do!

        Shami

  2. It’s time for a change in this old, stale industry. The market needs a forward-thinking, value add approach, instead of the same tired brokerage model that everyone has been forced to accept.

    • Thanks Chad! When our President, Vinnie Tracey (Former President of RE/MAX), first contacted me I was a bit skeptical at first. As many would normally be. However, once I got a good look at what they were doing differently, especially compared to companies charging huge fees with nothing in return but the goodwill of a brand, I truly feel that Canada is ready for a company that is “Agent-First” focused like ourselves.
      Shareholder demands have taken over the reins of many of the big brands as they become publicly traded and investment in serving the agents becomes an issue for stock prices.

  3. Well isn’t that novel, a monthly fee and a transaction fee, and a different culture…..sorry don’t see anything new here. It appears that this is a franchise….let’s do the math, they need at least 300 agents to breakeven in small western markets (Gulp), then he has to pay head office…someone did not do their homework here.

    • Hey Bruce! Thanks for your comments! We are more than just a 100% company with a “different culture”. We have been very successful in every market that we have entered into. Agents are drawn to our unique Coolture, our incredible technology package, training, and fee structure. I’m not sure how you feel that you need 300 agents to break even.
      I would love the opportunity to show you what we are all about!

      Shami Sandhu
      Regional Director – Realty ONE Group of Western Canada

Leave a Reply