Two of the largest Century 21 franchises in San Diego have merged, creating a major player in local residential real estate sales.
Effective Sept. 1, Century 21 Award and Century 21 Able joined forces to form a 10-office organization with approximately 700 sales people, said Jack Forness, president of Century 21 Able.
Forness said he became a major shareholder in the merged organization called Century 21 Award and is now in charge of the new company’s client services division.
Rick Jorgenson, owner of Century 21 Award, will continue as president and CEO. He was traveling and unavailable for comment.
Forness said the merged organization would be the largest independently owned Century 21 brokerage in the world. In 1999, his firm had gross sales volume of $650 million, while Century 21 Award sold $800 million last year.
Forness predicted the combined organization would sell between $1.8 billion and $2 billion in San Diego County real estate next year.
“We’re acquiring each other’s skill sets,” Forness said. “We should be able to dominate the East County market through economies of scale that will help us to efficiently bring service to our agents, who are independent contractors, and our clients.”
For Steve Games, owner of Prudential California Real Estate with 57 offices from Ventura County south , 25 of them in San Diego County , the combination of two competitors was a positive event.
He said he’s known both of the other brokers professionally and his agents regularly cooperate with theirs on selling real estate.
“I think what we’re seeing with the merger is the emerging strength of the branded real estate franchise,” Games said. “There’s also an economy of scale that’s achieved because administrative expenses are reduced when two offices become one.”
He also said savings on purchases of larger blocks of advertising are another reason to merge.
Games, who has gone through 30 mergers and acquisitions in building his company, cautioned there are some pitfalls when two companies join.
“Agents usually have a very strong bond with the broker they work for at successful companies,” Games said. “Different brokers have different leadership styles and when there is a change, agents sometimes leave.”
