Asset Management & Recovery: Rich Kruse (Gryphon USA, Ltd.)

From: Dan Duffy
Sent: Monday, November 02, 2009 3:27 PM
To: Tom Coolidge
Subject: United Country Sets All Time New Records for Web Traffic in October and September

Entire United Country Family -

I wanted to share some news that you can utilize in your local efforts to secure listings and recruit the best agents...

As most of you know, earlier this year, United Country deployed a number of advanced SEO strategies (that will remain confidential to the outside market) that have dramatically increased our "footprint" on the web.  These efforts are now fully implemented and are driving record results. 

We (all of us) set new, all time record performance benchmarks for web site traffic with new records in visitors for the months of September and October...even exceeding traffic results achieved at the peak of the market for those months.

Our traffic for the full portfolio of UC Home Office web sites is nearing 3 million visitors a month and more importantly 125 MILLION page views and 300 MILLION hits. 

Our strategy is resulting in a more targeted and localized traffic with more visitors, page views and hits coming on the localized and property type web sites.   Our primary home page is also seeing strong performance with just under a million visitors to that site alone (we are pushing visitors to the local web sites so this number intentionally will be flat for the foreseeable future).

We are posting updated web traffic collateral for your use locally on the web site with a new format to capture the full view into our traffic.

WE ARE THE NUMBER ONE WEB SITE FOR NON-URBAN REAL ESTATE IN NORTH AMERICA!  Others claim it but in their defense, they are not aware of all of our nearly 1,000 sites and the traffic those sites drive.  Either way, we are not in the pay to play lead aggregation business.  We do all of this for no additional fee as part of your affiliation with UC.  Only UC Offices, Agents and Clients can access the UC portfolio of sites.  This is competitive advantage for you.  

Dan Duffy

Chief Executive Officer

United Country Real Estate

www.unitedcountry.com

Selling defaulted asset has changed a considerable amount since I started in the business in 1997.  No matter what the asset class, sellers have always wanted to negotiate the fees and expenses being charged by their vendors.  It is human nature to negotiate and I think, to a certain extent, these financials should be pushed.

What I find interesting is the extreme pushback on fees and exclusivity in the real estate market today.

As an asset manager as well as a brokerage manager I have a unique way to look at these things.  On the one hand, I am sometimes the seller and decision maker.  On the other, I am sometimes the brokerage or auction vendor.  

A few months ago I started asking around about what was going on in other markets and looking closely at what requests were being made of agents in Columbus, Ohio. 

I have talked to agents all over the United States.  In summary, here is what most agents are thinking about these top 4 issues.

1. Exclusive Right to Sell - Most successful brokers/agents polled will not spend time and effort promoting an asset if the seller demands carve outs.  A broker is either hired or not hired.  Generally, there is no third option as far as they are concerned.
2. Commission Rates - Ask 10 brokers/agents and you will get a similar answer.  Brokerage fees have absolutely nothing to do with what was paid for a property or what was loaned on it, just like bank CEO salaries and legal fees.   
3. Minimum Commissions - There are a lot of assets in many marketplaces that, today, have very low value.  It is very common to have minimum commissions.  There is a certain effort that goes into every property regardless of price. 
4. "Joe Will Do It" - "Joe will do it for less."  "Joe will do it on these terms."  Most agents know a "Joe" and will tell you there are reasons Joe will do this and that.  Most will also leave it at that.  Be wary of the agents that tell you the story.  They are not going to keep your confidences either.

Overall this was a very interesting informal investigation with some interesting responses.  Hopefully this gives some insight to those who hire brokers and agents around the US.

In my last post, Grow, Merge, Sell or ? I was trying to decide which way to take our subsidiary Gryphon Realty Advisors.

Since then, we have met with numerous buyers of the business as well as numerous joint venture partners.  We met with managers.  We interviewed potential new staff members.

In the asset management and liquidation business, decisions need to be made quickly.  Over the 12 years I have spent in this industry I have learned that the biggest mistake I can make in business is to over think or second guess a decision.   

So, in the end, the answer to the question is GROW.  Ladies and gentlemen, we just jumped off the cliff into the deep water without a floatation device.  No turning back.   

In the very near future you will see modifications to our website at www.gryphonusa.com.  Marketing materials that are already in the re-design and printing process will be in the mail.  A year long pre-defined email campaign will be rolled out.  Meetings with our targeted clients have been scheduled.

We engaged additional superstar project managers for Gryphon Asset Management.  We are grabbing the bull by the horns and are brining in commercial real estate big hitters to Gryphon Realty Advisors - Commercial Division.  We are seeking more aggressive residential agents for Gryphon Realty Advisors - Residential Division.  We are bringing in seasoned auction staff and cross training current staff members to participate in Gryphon Auction Group by sending them to the best auction academies and appraisal schools available. 

I want to thank all of the people who shared their thoughts with me as I contemplated this very important decision. 

This question jumps into the realm of license laws, but with a little twist.  This came up the other day. 

Company A owns a 50% interest in Company B.  Company B owns a 100% interest in a real estate development.  In Ohio, there are license exclusions that allow direct employees of owners of real property to manage without a licence.

Can employees of Company A manage property owned by Company B in Ohio?  Can they do it in your state?

The ruling from the court should come in next week.  What do you think it should be?  Why?

The other day I saw something from afar that I have never seen before.  It was a rental house that goes for only $35 a month.  We tried to get a little closer to get a better picture, but the "driveway" had too many large potholes for the small SUV I was riding in.  Thinking about it, the house rents per month for less than I would have paid ti rent this SUV for a day.  My local contact was afraid to walk up.  Don't know why.

The house is part of a large court case that I am working on.  Eventually I will need to sell it, probably at auction.  Luckily, we also have large tracts of acreage.

What is a $35/mo rental worth?

What do 49 individual condos I had listed all have in common?  They are all in contract at a price acceptable to the bank and it only took about an hour to do it.

That is the sound bite.  It actually took a lot of hard work over the past three weeks to pull it off, but today was a success.

Over the past 3 weeks our office undertook a regional marketing effort that encompassed print media around the region in city and national publications, posted to dozens of websites that spidered out to even more, implemented a media campaign, sent direct mail and held open viewings.

The end result was over 12,000 web hits on our site, close to 100 individual emails and calls and 18 registered bidders.  Of the 18 bidders, we are in contract with 8 of them.

All we need to do now is get the contracts approved by the judge and move to closing.

Here is the real interesting part.  We offered the properties two ways.  First in bulk and then separately.  When you look at the gross sales numbers, the sales numbers are only separated by $4950.00.  Clearly these properties were sold for what they are worth in today's market.  

A friend of mine once said that if I ate a Snickers bar that I should put out a press release about it.  I'm not so sure about that, but media relations is a large part of our corporate marketing strategy.

A media campaign can be designed around almost anything.  For example, we send out a press release for every large event such as auction and when we bring on new staff.  In addition our local business paper, Business First, holds a free networking breakfast about every 7-8 weeks.  These events are great for seeing the reporters in a relaxed setting as well as networking.

I am writing this post because I get the impression that some folks are possessed about new marketing venues such as blogging.  Not that blogging is bad.  Quite the opposite, but the old school ways should not be totally discounted.

It is said that being quoted in the news media is the best advertising you can get.  Someone else is proclaiming you the expert. 

To prove my point (and pat myself on the back) I point to the last 12 months in our local market.  There have been 3 articles in about projects I am involved in and 2 about market conditions where I am heavily quoted.  I also regularly receive calls from reporters to get background for things they are writing about, to check facts and (drum roll) to get referrals to other local experts in town.  There are an easy 6 articles out there in the last 12 months where I was able to direct the reporter to another expert that I do business with.  The reporters remember it and so do the people I refer them to.

Something else that is neat is that I can track web hits and incoming call volume increases back to the days following sending out a release.  It is significantly higher following an article with my name in it. 

In short, media relations is good for business.

If you have never written a release before there are a ton of places online that can give you tips, just Google "press release tips".  Who, What, When, Where, Why, How and Company Information.

The next thing to do will be to get that release out to the reporters.  I have gone two ways.  First, you can search your marketplace getting the names of the reporters in your field of choice and contact them about how to send a release.  Most will want email while some of the smaller publications will still request a fax.

The second way would be to use a service such as http://www.prweb.com/.  This is more global and has a fee associated with it. 

I use both, but my personal list gets the most results.  Part of that is due to the relationship I have developed over time.

Good luck.

R

Hi folks.  Today is question day for me. 

I have an independent brokerage that is about 5 years old and getting to be pretty successful in our market niche.  When we opened our own business, I had been working the foreclosure market for years.  Now, it seems like the place to be.

Anywhooo, next week I am to fly out to visit with a franchise that does not have presence in my area.  I have read through their offering package and see a lot of things that are great, but also a lot of things that are in need of negotiation.

Here's my big question: Do franchises negotiate or is it a take it / leave it deal?

For example, they seem to want 20% of the gross.  I have agents that make 85-90% splits.

On their side, they have systems and national advertising, etc.  (BTW - Their national ads are not run in my state right now)

On my side I have an established business that covers most of a state where they have no presence at all.  It is a state that is near the top of the pack in foreclosures.  We specialize in that and this franchise is breaking into it.  We do commercial and they are breaking into that as well.

Are we in a position to negotiate at all?