The real estate industry is run by independents. Despite inroads by franchise brands to scoop up aging brokers' companies, providing them with an exit strategy, half of brokers range from mom and pop shops to sizeable independent firms with multiple offices. The other half are franchise owners, or franchise-owned brokerages.

That demographic is delectable for franchise firms which view the independent nature of brokerages as an opportunity for takeover and expansion of their brands, and that's what makes the merger announcement of three of New England's most respected independent real estate companies -- Lang Associates, McLaughry Real Estate and Pall Spera Company -- so interesting.

Just like that, the largest real estate company (sensibly named Lang McLaughry Spera) in all of Vermont and northern New Hampshire, and the third-largest in New England, has come into being as a major force.

These independents are bucking a trend. Instead of waiting to be purchased individually, these companies are merging and creating a new brand in the headwind of franchise growth. Hundreds of companies every year lose their independence, but these companies are keeping theirs.

Consider this: Just 10 years ago, only 38 to 43 percent of real estate agents belonged to a national, franchised brand, according to industry analysts. And today? More than 50 percent do. That's right: One in two agents working today does so under the banner of a national firm. And there's no sign of the trend slowing as the nationals aggressively woo individual agents and entire independent real estate companies to join their ever-swelling masses.

So what's making those New Englanders dig in their heels?

It came down to reputation and community identity that was worth more than a national brand name, according to the players.

"We are all well-known and each of the companies is number one in market share for their own areas," Staige Davis, owner of Lang Associates and chief executive officer of the new firm, explained to local media. "We've talked with every one of the national franchises over the years and some even in recent months. It just didn't make sense to us. What we've done is quite unusual—to have a merger with three non-competing firms from three separate markets."

Another unusual aspect to this merger is the fact that, as Davis mentioned, none of the three firms operated in competing markets. As a result, there were zero layoffs and office closings, and no agent mutinies. Instead, the combined resources of the three companies created a new company with 12 offices, a 200-member sales and support staff, and more than $600 million in combined sales.

The principals say all of that spells added benefits for New Englanders buying or selling homes, including increased listings exposure regionally and nationally along with more marketing support.

And for all of those sales associates now working for one of the nation's most influential independents, the merger, according to Davis, creates an unusual noncompetitive esprit de corps backed by inter-office creation and sharing of training and educational materials, along with enhanced purchasing power through combined ads, marketing programs, referrals and other media resources.

The irony is that this is the way many of the franchise brands -- as independents, and some are returning to their roots. RE/MAX International has resisted selling itself to a franchisor, and Realogy, parent of Century21, Coldwell Banker, and ERA brands, has gone private.

It will be interesting to see if other independents combat market influences by joining forces.

Published: February 5, 2007

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Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. For more articles by Blanche, click here.