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When an Acquisition May Be the Solution

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Industry Advisor by George Slusser

RISMEDIA, July 16, 2008-Many indicators are pointing to the fact that the last six months of 2008 may produce an unprecedented level of merger and acquisition activity in the real estate brokerage community. Although there have not been the headline-grabbing large transactions occurring recently, there have been hundreds of small and medium acquisitions made.

Art Zachary, president of Virginia Beach-based Rose & Womble Realty, believes the timing and opportunity is right for growth through acquisitions. “We are currently in discussions with a number of candidates; most would not talk to us six months ago, but now they are all listening,” he says.

Now, sellers are definitely more realistic and eager to work out a solution to their situation. All companies could use more top-line revenue in this market. “Fold-in” acquisitions can quickly turn an unprofitable office into a profit maker.

It also may be the right time to sell a company. This is not the year that sellers will retire from their proceeds, but selling may be the difference between creating a brighter future in real estate and risking their entire investment. Sellers need and want to see a way out with a better opportunity for themselves and their agents.

Solving the seller’s needs is the critical issue in today’s M&A environment. Savvy buyers need to take the time to address the seller’s future opportunities, employees, current debt, office space, F&E and other obligations. Those that look beyond the financial statement will have a distinct advantage. In these emotionally trying times, sellers need a solution to their problems, and if it is only money, you probably can’t afford it.

George Slusser is the author of Acquiring Profit. Slusser recently joined the PCMS Consulting Group, specializing in M&A assistance. He can be reached at gslusser@pcmsconsulting.com.

For more information, visit http://www.pcmsconsulting.com.

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