Brokers are using a variety of tactics to create new revenue sources in the face of sluggish house sales. Diversification is central to the brokerage that Rory S. Coakley and his wife Nancy established over 36 years ago in the Washington, D.C., area. Coakley Realty has been able to weather market headwinds by providing services to both residential and business clients.
What Does Your Company's Diversification Look Like?
As a one-stop shop, Coakley Realty can offer our clients a range of real estate services, including as residential and commercial real estate assessments, tax appeals, and litigation support. Stability comes from not putting all of our eggs in one basket. We might be working on more tax appeals and commercial real estate if home sales are slow. What I'll refer to as balance never exists. The pendulum continues to swing.
The housing supply was extremely low during the first half of 2024, but conditions improved in the final half of the year. In the meantime, we receive consistent, recurring revenue from Coakley Realty Management LLC, our property management business. We oversee a wide variety of properties, including retail, nonprofit, commercial, industrial, and residential ones.
It gives the agents additional chances to make money. Leasing companies also sell goods and may need asset management.
I think it makes sense to engage in several activities within the same business, and one of the key advantages is that the services we provide are free. For a single owner, we can sell them a home and handle their taxes, lease, appraisal, and appeal.
I've known this accountant for years, and he recently asked us to assess certain properties that were part of an estate. The building's owner called me shortly after and inquired, "Do you manage properties?" In summary, we were able to obtain a property management contract for 45,000 square feet of industrial space located just in our backyard.
Many of the procedures are the same, but I would advise a residential broker without any commercial experience not to attempt to represent a commercial client on a lease or sale. You identify the client's needs during your meeting, then you locate the data source that will enable you to meet those demands. Brokers who wish to broaden their offerings should obtain the required training and ensure they have access to the appropriate data. Alternatively, they could look for a commercial broker who is interested in establishing a section within their business.
A very solid business plan should be created at the outset and reviewed and updated every year for anyone looking to launch or grow a company. To help me avoid blind spots, I have also enlisted the assistance of other advisers. They will ask many questions that you may not consider. Additionally, they contribute an outside, unbiased viewpoint—as well as knowledge of what works and what doesn't.
The company was founded in 1961 by my father, Neil Coakley, and Fred Williams. Painting fences, excavating, and hauling cinder blocks were all part of my childhood job at the company. I eventually rose through the ranks to become a research analyst, director of acquisitions, vice president of development, and director of construction business development.
We began the brokerage because I eventually wanted to start a company that was our own. I still recall discussing it with my father. Although he was a little let down, he and my mother ended up being our biggest supporters.
In the end, my brother and brother-in-law purchased the company's construction division, which is now known as Coakley & Williams Construction. Their workers took up the reins not long ago. The son of Fred Williams purchased a hotel management company. Additionally, Donahoe, a sizable independent here in D.C., purchased the commercial leasing and property management section. Another sibling, who is still employed there, attended that company in the middle of the 1990s.
We all continued to work in real estate, and our relationships are still excellent. I still get business from the contacts I developed at C&W. For instance, we constructed two warehouses for a man in 1988. The owner had to lease the properties when I launched my business the next year. In addition to that, we took care of tax appeals for his residence, buildings, and a gas station he owns. My son is currently handling his management and leasing.
It seems a little unusual for a real estate brokerage to handle tax appeals.
We also work as appraisers, so it's a huge bonus that we know the properties and are in the business. An assessor provided three comps to bolster his assessment in a recent appeal. "I was inside the first property two weeks ago," I was able to say. We completed an appraisal on the second property six months ago. Two years ago, I sold my third property.
Additionally, I am not reliant on the data found in CoStar or the MLS because I have contacts in both residential and commercial real estate. Naturally, we use the MLS and CoStar and LoopNet for our commercial operations. However, as real estate agents, we can also obtain information from the public.
How Did You Become Well-Established In The Property Management Industry?
We were observing prospects in property management as a result of our broad residential and commercial leasing activity. Jim Dailey, the owner of a HOA management company, had been using our services to challenge real estate taxes. He held an MBA, a CPA, and back-of-house experience. I had more front-of-house experience in marketing and business development. In order to avoid combining ownership of the brokerage, it made appropriate for us to form Coakley Realty Management LLC as a separate business. It was 1999.
Why Was The Collaboration So Successful?
The three C's: communication, empathy, and compromise. We had a buyout arrangement, and Jim recently retired. In an effort to increase our presence in the industrial sector, our son Rory P. Coakley and another team member, Meghaan Lane, will now be in charge of the property management business.
You have a master's degree in real estate and urban development from American University and a bachelor's degree in finance from Georgetown University. What impact did schooling play in your success, and was real estate always a part of your big plan?
I never thought about pursuing a profession in anything other than real estate. I was fortunate to have intelligent parents who could afford to send me to reputable schools. At Catholic University, I also completed six construction-related courses. Additionally, there is always ongoing education because I am a certified general appraiser and licensed broker in Maryland, Virginia, and Washington, D.C.
Additionally, field experience is an excellent teacher. During my high school and college years, I worked on building projects. I worked in land acquisition after college, then transitioned into development. Rezoning, employing engineers and architects, obtaining permissions, leasing, and operations were all tasks I worked on.
Could You List Three Things That Have Helped You Succeed In The Long Run?
Many small and medium-sized businesses find us appealing since we are a family-run firm that operates locally. Our agents are given continuity by our hands-on management. Additionally, we have strong rates of agent and employee retention. Some have spent over 20 or 30 years here. I'm confident the business is in capable hands if I have to leave town.
In addition, I'm always networking and active in the community. Almost everyone you encounter requires help with real estate. Last month, Nancy and I started a conversation with someone at a happy hour. He remarked, "I might need your services," after I informed him I worked in real estate. As it happens, he is relocating from the neighborhood where I was raised to the one where I currently reside. He is searching for a bridging loan because it is currently impossible to purchase a property subject to selling your home. Guess what, though? I just had a lender visit to discuss bridge loans with our agents. I was therefore able to give details about a bridge-loan program.
That discussion is still going on. I'll update you on the outcome.
How Has 2025 Turned Out Thus Far?
With expectations of lower prices, inflation, and interest rates, it should be better than 2024. More homes may be put on the market as a result of people adjusting to these higher rates. The DMV's supply of active home listings is almost 30% greater this year than it was at the same period last year. We will continue to adhere to our firm philosophy, "Consider it done!" in spite of all the market uncertainty.