Juicy Boston brokerage throwdown: Condo Domain vs Otis & Ahearn
Well, since I'm based in Boston I thought it was only proper for me to comment on the lawsuit filed by Otis & Ahearn against Condo Domain! And hopefully offer some unique insight....
For those of you not familiar with the story, it's been flying around the blogosphere and has been reported in the Globe and Herald, but here's some very brief background:
Otis & Ahearn is a very well established Boston brokerage firm. Founded in 1978 (I believe), by Kevin Ahearn, they are one of the top firms in Boston (in terms of total volume at least). Although they do general brokerage representing individual buyers and sellers, a large component of their business is in new development marketing, working with developers of large condo projects to do the initial sales.
Condo Domain was founded in 2005 as an online real estate marketing portal. Their business model (at the time) was to create a real estate website that would attract buyer traffic interested in condos around the country and then turn and sell advertising to real estate brokers to monetize that traffic. However, after a couple years trying to grow an advertising based business, Condo Domain realized that they could not sustain that model and decided to convert to a real estate brokerage in January 2008. They entered the brokerage business as a so called "discount broker"as buyers agents only.
Tony Longo, who I believe was a mortgage broker prior to launching Condo Domain,
That's a little background. Now let me state this succinctly (and I don't have a personal relationship with either Kevin Ahearn or Tony Loungo so hopefully there's no bull and no bias in this):
Either Kevin Ahearn is brilliant or he is a complete idiot. No middle ground here.
He's an idiot if: Kevin has launched this attack on a small (very small compared to his)
He's brilliant if: Recognizing that his firm doesn't really compete with Condo Domain
I'm guessing that some of Kevin's general brokerage agents were more than a little peeved that their boss was investing money in a little startup doing "discount" buyer agency
http://www.inman.com/news/2009/01/23/condodomain-sued-over-shift-brokerage
http://www.condodomain.com/blog/traditional-brokerage-files-lawsuit-against-discount-condodomain/
http://blog.sellsiusrealestate.com/marketing-tips/condodomain-sued-by-minority-shareholders/2009/01/23/