Realty Center timeline
1982 - Realty Center is started by Ben and Karen Kelly and Wayne Powell. 1985 - Kelly's assume sole ownership and the firm affiliates with the Better Homes and Garden real estate franchise. 2002 - GMAC buys the BH&G franchise and firm becomes Realty Center GMAC. 2006 - Firm joins the Prudential Real Estate network and becomes Prudential RealtyCenter.com 2015 - On Jan. 13, firm affiliates with new network and becomes Berkshire Hathaway HomeServices Realty Center Agency At a glance New name:* Berkshire Hathaway HomeService Realty Center Owners: Ben and Karen Kelly General manager: Byron Kelly Staff: 155 Realtor agents 2014 sales:* $327 million Average sales price: $215,000 * In January 2015 Berkshire Hathaway HomeService Ownership: HSF Affiliates LLC, is an affiliate of Warren Buffett's Berkshire Hathaway Inc. Headquarters: Irvine, Calif. Franchise size: 34,223 agents and 1,056 offices operating in 47 states Local franchise: Realty Center, as of Jan. 13 Brand recognition: Berkshire Hathaway is the No. 1 company in Barron's 2013 ranking of the world's 100 most respected companies; it ranks at No. 8 in Fortune magazine's 50 Most Admired Companies survey; and is No. 18 in Harris Interactive's reputation study of the 60 Most Visible Companies. Other Berkshire businesses: Other affiliate businesses that are a part of Berkshire Hathaway in the region include Shaw Industries in Dalton, Ga., and Clayton Homes in Knoxville.
If you are looking to buy a home in the Chattanooga area, you soon will be able to get some help from one of the world's richest investors.
Warren Buffett's Berkshire Hathaway HomeServices will enter the local real estate market next month when one of Chattanooga's biggest real estate agencies joins Buffett's growing real estate business. Chattanooga's Realty Center, which operates five area offices with 155 agents, is replacing its Prudential franchise in January and taking on the Berkshire Hathaway Homeservices brand.
From left are Prudential Realty Center general manager Byron Kelly, vice president Karen Kelly and president Ben Kelly. Effective Jan. 13, more than 700 of the blue Prudential Realty Center yard signs at properties for sale across the region will be replaced by new cabernet-colored Berkshire Hathaway HomeServices signs.
"We hope the ground isn't too frozen when all of our new signs go in the ground," quipped Byron Kelly, general manager for Realty Center.
Realty Center is joining most of the major former Prudential real estate agencies switching to the Berkshire Hathaway HomeServices brand since Buffett's Berkshire Hathaway launched an ambitious thrust into residential real estate brokerage in 2013 when it began operating Prudential Real Estate and Real Living Real Estate brands.
Ben Kelly, who founded Realty Center with his wife Karen more than three decades ago, said the Berkshire Hathaway brand is one of the best known and respected in America and should help the agency to grow in 2015.
"Berkshire Hathaway HomeServices is a real estate-based business, where Prudential is primarily a financial and insurance business," Ben Kelly said.
Kelly said he was approached by other franchisers and Realty Center could have become an independent agency.
"After looking at it a few months, the choice became very clear that Berkshire Hathaway was the way to go," he said.
Realty Center was initially affiliated with the Better Homes & Garden, later purchased by GMAC, and the agency has been aligned with Prudential Real Estate since 2006.
The Toronto-based Brookfield Asset Management Inc., bought the real estate division of Prudential Financial in December 2011 and a year later sold the business to HomeServices of America Inc., an affiliate of Berkshire Hathaway.
The rebranding of Realty Center in Chattanooga is the latest in a string of Buffett-backed brokerages across the country.
Over the past 15 months, Berkshire Hathaway's HomeServices has quickly grown to one of the nation's biggest franchises with 34,223 agents and 1,056 offices operating in 47 states.
"We have transitioned most of the biggest Prudential agencies and we have several more in the next few weeks so we have almost all of the top 50 Prudential agencies," said HSF Affiliates' incoming CEO Gino Blefari. "This year has been mostly a year of transition and 2015 we see as a year of growth. One of the things that I will be working on with our franchisees is to grow the areas where we and expand to areas where we are not."
Blefari, who in only a decade built the nation's 12th largest real estate agency, will assume the top job for Berkshire Hathaway HomeServices in the United States while the current CEO, Earl Lee, will turn his attention to growing the brand overseas.
Blefari says with the cache of famed investor Warren Buffett, "the Berkshire Hathaway name has a magic about it."
"Every real estate broker wants to work the high end, and this brand puts people almost automatically into the high end," he said. "Some of the agencies we work with are telling us that they are getting calls from people wanting to work with them just over this name."
Already, the Berkshire Hathaway HomeServices was named 2014 "Real Estate Agency Brand of the Year" by consumers in the 26th annual Harris Poll EquiTrend study and "Startup of the Year" among all U.S. industries at the 2014 American Business Awards.
Warren Buffett, the so-called "Oracle of Omaha" and one of America's richest investors, agreed to allow the real estate business to be one of the few retail brands using his corporate name.
"When people are making the decision of the magnitude of buying a house, it's the biggest decision a great many families will ever make," said Buffett, chairman and CEO of Berkshire Hathaway Inc. "They want to know who they're working with and we think the Berkshire Hathaway name will be reassuring to many of those people."
In January, Berkshire Hathaway will train Realty Center agents on the new brand and its support networks.
"The technology and training will be upgraded, which will be a great advantage in addition to the tremendous Berkshire Hathaway name," Byron Kelly said.
New technology, computer apps and Internet real estate sites are quickly reshaping the real estate purchasing process. But as important as such computer-assisted tools have become for buyers and sellers, the overwhelming number of individuals still use a real estate agent to help with either purchasing or selling their home or property.
According to the National Association of Realtors, only 9 percent of homes sold in 2013 "for sale by owner" transactions. That was the lowest share of buyers and sellers not using a real estate agent in many years. In the year 2000, by comparison, 16 percent of homes were "for sale by owner" transactions.
"People recognize that to ultimately get into a house, see it for themselves and get the professional help they need with one of the biggest investment decisions most people make in their lives, they want and need a Realtor," Byron Kelly said. "I think there is a brick-and-mortar future for our industry. There may be smaller and more mobile facilities, but you still want a professional place where you can sit down and look at the contract that is going to be one of the biggest purchases of your life."
Contact Dave Flessner at dflessner@timesfreepress.com or at 757-6340