Around the Block: 7/30/2021

Now bear in mind that in the higher-end Philly market that I serve there was not a towering number of foreclosures. In fact, the vast majority of buyers I represented took out conventional mortgages and even those that went with more creative options did not go above their means. Making sure my clients were financially qualified and not stretching beyond reason is part of my job as well. I do not know of any of the 100s of buyers I represented during those years that had an issue with an unadvisable mortgage (nor any since). Philly was affected much less than certain areas of the country where foreclosures consumed everything else. Nevertheless, while all real estate is local, big economic downturns are typically global, and the Philly market slowed down significantly, though it did not suffer the vast drops of many other local markets.

So, 2009 was by far and away the slowest year I had in real estate. In early 2010, the federal government created a program to provide a significant credit towards closing costs to first-time buyers (i.e., free money if you qualified). And many first-time home buyers took advantage, thus temporarily spurring the market during the spring of 2010. Eligible buyers had to close by April 30, 2010 to receive the grant and the first four months of 2010 were wild. Kristen was pregnant with our first child at the time and was due right around the credit deadline. I had so many closings scheduled for those final weeks; what would I do? Well Ari Block was born on April 30th, just at the end of the deadline, and I took some very well-deserved time off (but not too much time, of course).

2011 and 2012 were also slow years as prices continued to slump, stabilized through 2013 and 2014, and then started to slowly come back up in the mid-teens. So, while business remained slower compared to the Aughts, Philly is a steady market, and sales continued. And as this slower period between 2008 and 2014 continued something became clear to me. That while overall sales were down, my market share was up. Way up. I had now been in the business for about a decade and had an established reputation and an excellent team. One thing became clear. When times are tough, and properties are slower to sell, people want to work more and more with the highest quality professionals. And by the time the economy and Philly market started to heat up again, I was among the top Realtors in the city and CBT was among the top teams. I had been at Fox & Roach my entire career, and though it changed its name from Prudential to Berkshire Hathaway, nothing else had changed. It remained the top office in the city, and I had no interest or even thought of leaving.

Then in June of 2018 I received a call from someone named Robert Reffkin in NYC, who said he was one of the founders of a real estate company called Compass. He said Compass was coming to Philadelphia and he planned to recruit an all-star lineup of the best agents in Philly from all different brokerages to form the Philadelphia founding agent group. Compass would grow the office from there into a regional powerhouse of the highest-quality real estate professionals in the Philly area. Then he added that Compass was in the process of doing this in major markets across the country.

Now let’s be clear. I am a Philadelphian, and I like how we do things in Philly. I like our standards—cheese steaks wit, soft pretzels, water ice, and roast pork with broccoli rabe and sharp. I love the Eagles, Sixers, Phillies, Flyers, and Temple Owls. Independence Hall, Liberty Bell, Wawa, Philly Zoo, Franklin Institute, and the greatest (fictional) athlete of all time, Rocky Balboa. Out of town companies have come to Philly before and failed. I had never heard of Robert Reffkin, and he was making some big claims. I was regularly recruited and always decided I wanted to be at the best office in Philly, so I never made a move, and frankly, was never even seriously tempted. And now I get a call from NYC, and I am supposed to be impressed? Well, I was a little.

Robert said something that was different and that caught my attention. He said that when Compass comes into a city, they hire local– the best management and staff, all from Philly. And that Compass understands that every real estate market is totally different and has unique ways of doing business, and when Compass names its management staff, it will consist of the brightest minds in Philly real estate. Moreover, it will include among the smartest agents in Philly, and these founding members will be able to use Compass’s systems and technology to create the structure for how the ultimate Philly residential real estate office should run and conduct business. And there was so much more to it. I spoke to Compass Strategic Growth Manager Jason Noah into the summer and could not have been more impressed. There was much more to the Compass vision than just the chance to start the ultimate Philly real estate brokerage. A lot more. By the first week of August, for the first time in my career, I was strongly considering leaving Berkshire Hathaway Fox & Roach. And then came the clincher. Compass told me they were hiring Skye Michiels as the Philly sales manager. I had known Skye for years, and he and I had had many detailed conversations on running and building real estate teams. While my strength has always been in providing expert real estate representation, Skye was just as skilled in improving real estate systems and teams. The day I found out Skye was joining Compass; I knew 100% I was coming to Compass. And within 30 days, on September 10, 2018, I sat in my new desk, ready to start the next phase of my career.

Next week, in the final part of this series, I will discuss how we fared starting up Compass Philly, what the City Block team is up to now, and what happened to Robert Reffkin and his company (Spoiler Alert—everything Robert promised that Compass would deliver, they did, and then some). Stay tuned.

Enjoy the weekend.

Warm regards,

Jeff