Luxury real estate brokerage Douglas Elliman is going to be spun off from its parent company Vector Group, the owner of discount cigarette brands and Nathan’s Famous hot dogs.
Howard Lorber, the CEO of Vector, told Bloomberg that the spinoff would occur on Tuesday, with the luxury brokerage being listed on the New York Stock Exchange under the ticker, “DOUG.”
“Tobacco has good, consistent cash flow, but there are still certain funds and institutions that won’t invest in it,” Lorber told Bloomberg in an interview. “This opens up the capital markets directly for our real estate business.”
Lorber also said the new structure would help attract employees and acquire brokerages in target markets.
Over the years, Elliman, once Prudential Douglas Elliman, has burnished a reputation for being a top player in key luxury real estate markets, especially its stomping grounds of New York City. Elliman was the third-largest residential brokerage in New York City by closed sales in 2020, with $3.06 billion, which placed it behind Compass and the Corcoran Group, according to The Real Deal’s annual rankings. It also has a big presence in Miami, and is growing in Los Angeles.
Like most luxury brokerages, Elliman has sought to expand its national presence in recent years to emerging markets. It’s opened offices in Aspen, Dallas, Houston and Austin in the last two years, all of which have seen a big uptick in luxury sales.
According to the 2021 RealTrends 500 national rankings (based on 2020 data), Elliman was No. 18 by transaction sides and No. 6 by sales volume. A year earlier, it was No. 11 by transaction sides and No. 6 by sales volume. Transaction sides were down 3.6% but sales volume rose 0.8% in that time, according to RealTrends 500 data.
Scott Durkin, the CEO of Douglas Elliman, will be the CEO of the company’s new brokerage holding company, known as Douglas Elliman Realty, Bloomberg reported.
Elliman posted $25.1 million in net income during the third quarter, with revenue at $354.2 million and total sales volume at $12.6 billion.
In an interview with HousingWire in August, Durkin talked about the impact of laying off 30% of staff as well as how it competes with Compass and others.