Partner Power

8Back from the Brink: RISMedia’s 22nd Annual Power Broker Survey

Dottie Herman President & CEO, Prudential Douglas Elliman

Joe Jackson Head of Wells Fargo Ventures Earl Lee President, Prudential Real Estate Affiliates Inc.

Partner Power

Strong Relationships Create Success in Today’s Real Estate Market April 2010 $6.95 www.rismedia.com

Reprinted with permission of RISMedia,Inc., publisher of REAL ESTATE magazine • (800) 724-6000 or rismedia.com • April 2010

From left to right: Dottie Herman, President & CEO, Prudential Douglas Elliman; Earl Lee, President, Prudential Real Estate Affiliates Inc.; and Joe Jackson, Head of Wells Fargo Ventures.

Reprinted with permission of RISMedia,Inc., publisher of REAL ESTATE magazine • (800) 724-6000 or rismedia.com • April 2010

Partner Power Strong Relationships Create Success in Today’s Real Estate Market

By David Fryxell

I

n simpler times, the mantra for what really matters in residential real estate was “location, location, location.” It was a fundamental concept, summarizing and

emphasizing the longtime No. 1 rule in real estate. In today’s tough times, however, many savvy brokerage owners have signed on to a new mantra: “Relationship, relationship, relationship,” underscoring the connectivity between the brokerage and its team of real estate services.

More often than not, brokerages that not only survived but succeeded in 2009 relied on their mortgage company for major contributions to their bottom lines. Among the strongest alliances in the industry are those between top Prudential Real Estate Affiliates and Wells Fargo Ventures.

“We clearly value the relationships our affiliates have with their partners,” says Earl Lee, president of Prudential Real Estate Affiliates Inc., a nationwide network of 1,700 offices and 50,000 sales agents. “The

strength of the joint ventures is a win for everyone.”

Wells Fargo Ventures, a division of Wells Fargo Bank, N.A., is marking its 17th consecutive year as the nation’s top strategic alliance lender. In 2009, despite the challenging environment, two top Prudential alliances each funded $1 billion in mortgages. (Five Wells Fargo joint ventures each funded more than $1 billion). Prudential joint ventures also increased mortgage capture rate steadily in 2009, with some approaching 45% versus the industry average of 15%.

Lee and Joe Jackson, head of Wells Fargo Ventures, strongly agree that great results depend as much on the quality of the relationship as on economic conditions. “The test of the true character of your partners comes when times are tough,” Lee says. “But when you have alignment around core business principles, I see those businesses doing well, regardless of the climate.”

Jackson sees a continuation of controlled, profitable market share growth for joint ventures in 2010.

“Even flying in headwinds, you can continue to gain altitude,” he says. “No matter the environment, the best solutions come from open and frank discussions.

Smart people, given the same facts, will come to the same conclusion.”

Reprinted with permission of RISMedia,Inc., publisher of REAL ESTATE magazine • (800) 724-6000 or rismedia.com • April 2010

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Open, frank discussions also resonate with exceptionally proactive in this area, most recently Dottie Herman, president and CEO of New York- delivering a comprehensive RESPA reform solution based Prudential Douglas Elliman Real Estate, the ahead of national implementation. Managing the fourth-largest independent real estate company in details of the Home Valuation Code of Conduct the United States and a leader in the Prudential (HVCC), the Home Ownership and Equity ProtecNetwork. tion Act (HOEPA) and the Housing and Economic “In choosing a business partner, I never just Recovery Act (HERA) is a key component of the look at numbers,” Herman says. “I look at com- joint venture value proposition. monalities of goals.” For Herman, understanding “Thanks to our partnership with Wells Fargo, what was important to her agents and what they we have been ahead of the curve and the indusneeded in a mortgage relationship involved many try on regulatory changes, positioning our team conversations en route to the launch in September as leaders in the markets that we serve,” says Rei 2009 of the joint venture DE Capital Mortgage. “I Mesa, president and CEO of Prudential Florida Rebelieve that people support what they help cre- alty, the sixth-largest company in the Prudential ate,” she says. “Wells Fargo hit the expectations. Real Estate Affiliates network, and the largest in And they kept their word. We’re on the same the state of Florida. Florida Home Finance Group wavelength about the joint venis the mortgage alliance between ture’s goals.”

Prudential Florida Realty and Staying on the same wavelength Wells Fargo Ventures. Mesa says requires continuous conversahe has been excited to see his tion,” says Ron Peltier, chairman mortgage and title specialists beand CEO of HomeServices of come the in-house industry exAmerica, Inc., a Berkshire Hathaperts for Prudential Florida sales way Affiliate. HomeServices operassociates and customers. ates in 21 states with 20 brands, Sheldon Detrick, CEO of Pruincluding Prudential California dential Detrick Realty, which inRealty, Prudential Carolinas, Prucludes Prudential Alliance Realty dential First Realty and Prudential in Oklahoma City, says respond– Earl Lee, President, York, Simpson, Underwood Realty, ing to new regulatory requirePrudential Real Estate Affiliates and is the second-largest, full-serments has been an important vice independent residential real part of his job, too. Santa Fe estate brokerage firm in the United Mortgage, jointly owned by PruStates, according to RISMedia’s 2010 Power Bro- dential Detrick and Wells Fargo Ventures, is markker Report. HomeServices Lending is the national ing its 12-year anniversary. “I like where we have mortgage company of HomeServices of America been positioned—with the rest of the industry just and the largest Wells Fargo joint venture. “Mort- catching up,” Detrick says, adding that he considgage is a complicated business,” Peltier says. “The ers managing change proactively a competitive way the financing goes, so goes the real estate ex- advantage. perience. This is a recognized industry principle Other qualities listed by Prudential broker/ownand explains why so much of our focus is on the ers as key to successful partnerships, include stamortgage relationship.” bility, experience and expertise, shared decisionJon L. Cook, president and CEO of Prudential making, innovation, face-to-face connections and California Realty, the largest franchisee of the Pru- personal ownership of relationships. dential Real Estate Network and one of the top Linda Sherrer, president and CEO of Prudential five brokerages in the nation, sees this principle Network Realty of Jacksonville, Florida, is among in practice. “If there is a question about mortgage, the original 10 members of the National Advisory the agent or the mortgage consultant can call me Council of Prudential Real Estate Affiliates, Inc. In or our HomeServices Lending president or the her experience, stability and brand strength top Wells Fargo relationship manager,” Cook says. the list of important characteristics. “Our former “We are all focused on making sure we are hitting mortgage partner went out of business, and Wells our service targets.”

Fargo stepped up and helped us transition,” she Evolving government regulations and new in- says. “The Wells Fargo brand and proven track revestor requirements for the mortgage industry cord instilled confidence in our agents and clients. have added complexities. Wells Fargo has been This was key to our selection of a mortgage part-

“The test of the true character of your partners comes when times are tough.”

Reprinted with permission of RISMedia,Inc., publisher of REAL ESTATE magazine • (800) 724-6000 or rismedia.com • April 2010

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Prudential Douglas Elliman/ DE Capital Mortgage Dottie Herman, left, president and CEO, and Tonya Strobel, alliance relationship manager, Wells Fargo Ventures. Herman says: “In a relationship, I don’t just consider expectations in revenue and services. I also look at the chemistry. Two partners have to be in sync.” Photo by Tommy Hultgren

Prudential Gary Greene, Realtors/ Gibraltar Mortgage Services Business partners Mark Woodroof, left, and Marilyn Eiland, with John Heroff, alliance relationship manager, Wells Fargo Ventures.

Heroff says: “We adopted a ‘Drive for 25’ capture rate initiative, and we’ll continue to increase the number of ‘at-bats’ with clients as well as grow staffing.” Photo by Alvin Gee

relationship manager, Wells Fargo Ventures. Mesa says: “Our entire executive team gets compensated on the core lines of business— real estate, mortgage, title and insurance. We’re committed to shared success—we have no ‘ancillary’ services.”

Photo by Bobbi Smith

Prudential Network Realty/ Gibraltar Mortgage Group Christy Budnick, left, executive vice president, and Linda Sherrer, president and CEO, with John Hemmesch, Wells Fargo Ventures alliance relationship manager.

Hemmesch says: “To deepen relationships between agents and loan officers, we’ve done a series of marketing programs, including ‘We Deliver,’ playing off a pizza theme. It was fun and playful and well-accepted.” Photo by Diane Uhley

Prudential California Realty/ Guarantee Pacific Mortgage

Prudential Florida Realty/Florida Home Finance Group Rei Mesa, president and CEO, and Kim Castiglioni, alliance

Eric Moayedi, left, Wells Fargo Ventures alliance relationship manager, and Craig C. Lewis, president and CEO. Lewis says: “We are spending the time to build relationships and having more one-on-one conversations with our target agents.”

Prudential C. Dan Joyner Realtors/ Carolina Mortgage Robert Opdyke, left, Wells Fargo Ventures alliance relationship manager, and C. Dan Joyner, founder and president. Opdyke says: “We’re continually focused on building capture rate. Recent activities have included offering ‘second opinions’ to preapproved clients, and an e-newsletter to help educate agents.” Photo by Alex Hyman

Prudential Rubloff/RWF Mortgage CEO Chris Eigel, left, and president Michael Pierson, with Mary Gilbertson-Lee, Wells Fargo Ventures alliance relationship manager. Pierson says: “Wells Fargo has given us insight into finding the balance between providing sufficient loan officers in a branch while at the same time giving the loan officer enough business opportunity to make a satisfactory living.”

Photo by Frank Steltenkamp

Reprinted with permission of RISMedia,Inc., publisher of REAL ESTATE magazine • (800) 724-6000 or rismedia.com • April 2010

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ner, particularly during a time of great instability problem, we get a quick response, and we value in the mortgage markets.” seeing a partner working from the same basis.”

Evidence of the good choice, says Prudential NetEiland’s business partner, Woodroof, describes work Realty Executive Vice President Christy Bud- working from the same basis to surpass goals for nick, shows in Gibraltar Mortgage Group achiev- on-time closings in the joint venture, Gibraltar ing 32% mortgage capture rate in 2009, their first Mortgage Services. “We had hit a bump in the year as a partner. “We have a proven track record road, so we got on the phone and talked together with our partnerships—title and relocation—and to identify opportunities for improvement,” he knew that we could hit a home run with mort- says. “Then we made a game plan. And we congage. We asked 300 agents to have trust in—and tinue to talk to make sure we’re getting to where trust their paychecks to—the joint venture and I we all want to be.” am proud to report that our people gave us that In-person conversations, of course, build on daychance.” to-day phone and e-mail communications. This is Constant commitment to continuing to build a differentiator in the Wells Fargo joint venture capture rate—45% is Sherrer and Budnick’s target model, with dedicated alliance relationship manin 2010—has included a new advertising and so- agers working routinely in-market with Prudential cial media campaign titled, “We’re Connected.”

Affiliates. Craig C. Lewis, president and CEO of “It’s fun and features ads and webisodes that Prudential California Realty, serving the Northare stream-of-consciousness,” Budnick says. “Most ern California communities of Modesto, Manteca, importantly, it reinforces our message that we are Turlock, Ceres, Merced, Fresno, Tulare, Vacaville, a team of real estate services.”

Fairfield, Vallejo and Napa, indicated that face-toBuilding mortgage capture rate is a 2010 mantra face connections deepen a relationship. across full-service brokerages, and Bill Chee, presi“We’ve been able to say what needs to be said, dent and CEO of Prudential Locations, the largest and do what needs to be done,” Lewis says. “We locally owned and operated real estate company view this almost from a board of directors perspecin Hawaii, has a well-established baseline. Pruden- tive, and think about what is in the best interest of tial Locations’ in-house mortgage company, Wells the business unit.”

Fargo Home Mortgage of Hawaii, has historically The conversations, and resulting actions, have delivered capture rates in the high 30s, even reach- had a strong effect on Prudential California Realty’s ing the mid 40s. Chee says one benefit of being home-financing alliance, Guarantee Pacific Mortin a long-term alliance has been gage. Capture rate is up 15% yearteaming together to deliver new over-year, and it has increased initiatives that help drive both more in the past six months than mortgage and real estate business. over all of last year. Lewis says he For example, his team is part of an considers this a demonstration of agent-based, short-sale pilot and taking personal ownership of the a market-specific, first-time home venture. “When agents hear me buyer campaign. say, ‘I will take personal responsi“We appreciate opportunibility for this,’ it is a psychologities to innovate—and respond to cal shift. This mortgage company the climate,” Chee says. “What I is a valuable relationship, and if I like is that we’re together in the value it and take it on as my own, – Joe Jackson, decision-making process, and are others see that.” both committed to providing our Changing language and changHead of Wells Fargo Ventures clients with industry-leading oping attitudes have helped in initions that best fit their needs, and tiatives to increase mortgage-team delivery with the highest level of service.” staffing, integration and capture rate with sales Shared decision-making is a “give-and-take managers. Lewis says he is starting to see more deal,” says Marilyn Eiland, partner with Mark one-on-one conversations and relationships being Woodroof at Houston-based Prudential Gary built at the agent level with this new attitude and Greene, Realtors, ranked No. 9 in the Prudential approach.

Real Estate Services Network. “Not every day is Staffing and capture rate connect directly, as sunshine and roses, and you have to compromise demonstrated by RWF Mortgage, the Joint Venture on some things,” she says. “But when we have a serving the Chicagoland Prudential Rubloff team.

“Even flying in headwinds, you can continue to gain altitude.”

Reprinted with permission of RISMedia,Inc., publisher of REAL ESTATE magazine • (800) 724-6000 or rismedia.com • April 2010

MVPs

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Bill Chee

Jon Cook

Shel Detrick

Allen Crumbley

Ron Peltier

Dewey Mitchell

Pete Slaugh

RWF launched in 2005 and has expanded with gards “showing the value” as an ongoing process. the November 2009 merger of Rubloff Residential “Our sales executives are constantly reminded by Properties and Prudential Preferred Properties. our managers, as well as through visuals displayed Michael Pierson, president and throughout our offices, about the chairman of Prudential Rubloff, benefits of utilizing our on-site says, “We have been impressed mortgage company. We encourwith Wells Fargo’s aggressiveness age sales executives to position in growing our mortgage prestheir home mortgage consultant ence. We have already added sevas a member of their team when eral highly qualified loan officers, working with clients. It’s the same and we are on the verge of adding with any relationship—you have several more in the very near futo keep working at it for it to be ture. In a very short time, we are successful.” making a significant expansion to One Prudential affiliate with a what was already a strong mortnewly established joint venture gage loan operation.” offers a different view of the value Adds Prudential Rubloff CEO agents place on an in-house mortChris Eigel, “We truly have a joint gage company. C. Dan Joyner, venture. We work together well in founder and president of Pruden– Dottie Herman, President & CEO, tial C. Dan Joyner Realtors, one of determining goals for the branch Prudential Douglas Elliman offices and the loan officers and the leading real estate companies recognize that achieving acceptin Upstate South Carolina, reable levels of business is a mutual responsibility.” members discussing the September 2009 launch of Shared initiatives in 2010 will include recruiting Carolina Mortgage with his team. top-talent loan officers and agent training. Toward “Our agents were glad to be associated with that end, plans are underway for in-branch, re- brand recognition,” Joyner says. “We’ve had many gional and company-wide educational sessions to calls over the past few months from agents sayhelp sales professionals succeed. ing, ‘We heard you’ve aligned with Wells Fargo.

Prudential Tropical Realty co-owners Dewey Do you have any openings?’”

Mitchell and Allen Crumbley appreciate the value Agent satisfaction also ranks high for Pete of shared business philosophies—and strong brand- Slaugh, an owner of Prudential Homesale Services, ing. “Looking at Prudential and Wells Fargo on any one of the leading real estate companies serving level, you have two companies that are best-in- South Central and Southeastern Pennsylvania. His class,” Mitchell says. “And this extends to the joint team is currently in the process of joint venture venture level. Shared expectations and a common implementation. bond foster a successful partnership and enable our “What’s good for customers is good for agents, sales executives to deliver a higher level of service and the fact that Wells Fargo funded 24% of all to their clients in a real estate environment that can mortgages in 2009 speaks volumes to agents,” sometimes be challenging.”

Slaugh says. “We’ve been in this industry for a long According to Crumbley, in 2010, Prudential Trop- time, and we understand our business. Why other ical consistently ranked in the top two real estate brokers don’t involve themselves in additional companies in the Tampa Bay area, and the joint services such as title, mortgage and homeowners’ venture Capstone Home Mortgage will continue insurance services, I don’t know.” RE to emphasize to agents how they can benefit from working with the in-house mortgage team. He re- For more information, please visit www.wellsfargo.com/jv.

“In choosing a business partner, I never just look at numbers. I look at commonalities of goals.”

Reprinted with permission of RISMedia,Inc., publisher of REAL ESTATE magazine • (800) 724-6000 or rismedia.com • April 2010

Right team. Right time.

Delivering value to our partners for over 17 years.

We drive controlled, profitable market share growth, and build lasting relationships based on shared goals and common values. At Wells Fargo Ventures, our strategic alliances have led the way in getting the most deals done — for the past 17 years.

Team with a winner: Wells Fargo Ventures 1 800 526 9496

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Leading in a challenging environment: • Sustained results • Industry-leading capture rates • Proven best practices • Committed to mortgage as an entity • Bullish on the future of our business