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March 1, 2018
Douglas Elliman’s expansion into new markets paid off in 2017 with a boost in earnings from the previous year. Despite a slower new development market, Elliman earned 7 percent more than in 2016 bringing in $722.3 million in revenue. The brokerage also had a net income of $21.4 million in 2017.
Douglas Elliman Chairman, Howard Lorber attributed the increased sales to their expansion into new markets. Las year Elliman expanded with the acquisitions of Teles in Los Angeles and Otis & Ahearn in Boston. Despite the higher sales volume, Lorber said fewer new development closings hurt profits in 2017. “We’re hoping 2018 will be a better year in closings in new development,” he said, “but many times, due to construction delays and so forth, it’s hard to pin down when the closings will occur.”
During an earnings call Thursday, Lorber gave his opinion regarding the so-called market correction in real estate. He mentioned a number of high-end deals at 432 Park Avenue in 2017 as evidence that the ultra-luxury market is strong. The $10 million to $20 million residential market is a “little softer right now” because sellers are still overpricing units, he told shareholders. “As the sellers realize that the market is a little bit lower than they thought it was, and start lowering their prices, activity picks up,” Lorber said. “Hopefully that’s starting to happen.”
Source: The Real Deal
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