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It looked to be a gorgeous day in San Diego on Tuesday as Compass RETREAT attendees basked in warm rays of sunshine at the open air Rady Shell music venue while the brokerage’s CEO, Robert Reffkin, welcomed the crowd with confidence and reassurance.
“Despite a challenging real estate market, one of the worst on record, where mortgage rates have increased faster than any time in history, where there’s just not enough inventory, where the courts are challenging the value that you provide in your commission,” Reffkin said. “Despite all of that, I’ve never been more confident in your company.”
Where Compass is today
Reffkin went on to tout the brokerage’s solid positioning in the industry today, having become, for the second year in a row, the No.1 brokerage by sales volume in the country. The CEO also said that the brokerage’s agent retention rate is looking strong — with 98 percent of principal agents remaining with Compass last quarter, and over 300 agents who left the company in the last year having boomeranged back.
In less than 10 years from launching its first sale, Compass will have sold over $1 trillion in sales volume, Reffkin added.
Where the brokerage is going
Looking ahead to the brokerage’s future, Reffkin said Compass would “elevate the role of the real estate advisor and empower each and every one of you to double your market share.”
Reflecting on the early days of Compass’ inception, Reffkin recalled something that Leonard Steinberg, Compass’ “chief evangelist” and head of the New York City-based Leonard Steinberg Team, told him.
“Robert, the future of this industry is in high-tech and high-touch,” Reffkin recalled.
“And it’s been in the DNA of this company ever since,” he added.
Through Compass’ proprietary platform and the 500 people on its technology team, Reffkin asserted that no company would invest more in its agents than Compass.
Prioritizing in-person interactions
But the CEO also stressed that creating high-touch, in-person interactions with clients to build meaningful relationships was more important now than ever, in the wake of the peak Zoom era, and as agents seemingly have fewer opportunities to transact.
“High touch is a unique opportunity of this moment,” Reffkin said.
Since the brokerage’s RETREAT last year, Reffkin said he had recommitted himself to the company culture, what he called “our culture of connection,” as he saw other real estate CEOs become more distant from their companies and agents.
In response, Reffkin committed himself to visiting every Compass market, and ended up going to over 200 offices in person in the last year. He also began inviting agents and employees to his house nearly every week and, ultimately, started bringing his family to Compass open houses on Sundays — even on Mother’s Day.
“I know it’s not an easy market, but I also know this market is your greatest opportunity disguised as a challenge,” Reffkin said.
The CEO stressed that those agents who spend more face-to-face time with people — and nurture relationships — are the ones who will succeed in this difficult market.
“The math of real estate is very, very simple: If you want to increase your business, increase the number of people that you speak to,” Reffkin said. “I’m not worried this country has an inventory issue, I’m worried we have a connection issue.”
He went on to argue that agents had “been deceived” into thinking that texting, emailing and posting on social media are forms of connection, but those media cannot convey tone or the warmth in someone’s eyes.
“It brings out your greatest fears,” Reffkin said, of communicating through a screen.
He went on to recall the first Compass board meeting that was held in person after two years of Zoom meetings because of the pandemic. As people engaged in small talk during breaks, Reffkin was appalled at himself when he realized he didn’t even know which members had children at home and which didn’t. But at the end of the day, the consensus was that it was the best meeting the group had ever had.
“It was the best meeting because we were able to see each other face-to-face, to see each other’s body language, eye-to-eye, and truly connect,” Reffkin said.
“You can’t build trust virtually, and our industry is built on trust,” he added.
“This is a time to get old school. Eyes-on-eyes, face-to-face, building your business one relationship at a time.”
In the spirit of connection, Reffkin also asked agents to spend as much time in their offices as they did in 2019, because being around other agents spurs conversation and opportunities.
“I know you chose this industry for flexibility,” Reffkin said. “But I’m not asking you to do more than you did in 2019. Just go back to your calendar in 2019, see how much you were in the office, and come back that much. Not for me, but for you. For your happiness and business, you need to be around other agents.”
How buyer agents will respond to threats to their commissions
In the wake of the Sitzer | Burnett verdict, Reffkin said he had been sensing a lot of fear from agents about their commissions now being jeopardized. But he noted that threats to an agent’s commission were nothing new to the industry, after various trends that waved through real estate, like the internet, iBuyers, discount brokerages and more.
“Through all those decades, you continued to prove your worth, to prove your value,” he said.
Reffkin went on to add that dozens of Compass agents already employ broker buyer agreements with their clients, as exclusively buyer agents, and that this is something the brokerage is committed to helping its agents master.
“The answer to this current predicament sits in the company today,” Reffkin said, noting that at RETREAT, Compass agents Lucy Mao and Raziel Ungar were slated to present at a panel entitled “Establish Your Value As a Buyer Broker,” during which they would review their own strategies in representing buyers and creating buyer broker agreements.
“By doing this, all of you will be forced to sell your value to buyers as much as you do to sellers, which will result in elevating the role of the real estate advisor and empowering you to gain market share from agents that don’t know how to communicate their value,” Reffkin said.
The Back to Basics Challenge
To inspire agents to take seriously Reffkin’s call to spend more time connecting, the CEO said he’d be launching on Monday “The Back to Basics Challenge,” the brokerage’s biggest challenge yet.
In tandem with daily trainings and mastermind sessions led by Compass’ top coaches and agents on how to execute buyer broker agreements with clients, agents will track through Compass’ CRM how many buyer exclusive agreements they get signed and how many in-person interactions they have with clients.
The top 10 agents who sign the most buyer exclusive agreements and have the most in-person interactions during the first 100 days of 2024 will receive a trip to New York City for a full day of mastermind sessions, which will also include breakfast with Leonard Steinberg, lunch with Courtney Smith and Skye Michiels, and dinner at Reffkin’s home.
“If through this we can all commit to spending twice as much time with people in-person next year, I’m willing to bet that your business will go up two times as well,” Reffkin said.
The CEO also teased some big things to come for Compass in the next year, including new client dashboards specific to both buyers and sellers and a suite of team functionality. In forthcoming years, he also said the brokerage would be launching internationally in London, Hong Kong, Singapore, Dubai and Sao Paulo.
“And we will ensure that this company, in its DNA, at its core, will always have the best technology and the best team.”
Email Lillian Dickerson