Provincial brand makes a bold move

01-03-2010 | Tony Leggett

Real estate is an eye-to-eye business, Tim Mordaunt says. It's a recurring theme in the success story of provincial real estate company Property Brokers and its ebullient managing director.

There's no detailed company strategy or plan that Palmerston North-based Mordaunt has used to grow his business and its share of the market over the past three decades.

Success in the cut-throat business of real estate, he says, relies a lot on timing, having the best team, supporting it and picking the right opportunities to develop.

His latest move, a franchise operation with Canterbury firm Hastings McLeod, is vintage Mordaunt.

When many other real estate firms are struggling, he's growing the business he started nearly three decades ago in a converted residential home, just on the edge of Palmerston North's central business district.

The Hastings McLeod franchise move is a bold one by Mordaunt's own admission.

"I had to be sure our brand was safe in their hands. But they have good people, great local knowledge, a very good business and I've known them for years. I'm confident they will enhance the Property Brokers brand in the Canterbury region."

Hastings McLeod shares membership with Property Brokers in the NZ Realtors nationwide network. It now operates as a franchise of Property Brokers within a defined geographical area from North Otago to North Canterbury, offering residential, rural and lifestyle sales, plus property management.

"They (Hastings McLeod) are very good at rural, but there was also a cultural fit and we have an infrastructure that we can share with them. But most importantly, we're similar people," Mordaunt says.

He's watched bigger companies "gobble up" other smaller, regional businesses, but believes strongly in competition and providing farmers with choice at a regional level.

"We've had opportunities to go to Wellington, but we've always resisted them. My heart's in the provinces."

Mordaunt's days in real estate started much earlier, with stints at several stock and station companies like J.E. Watson and Hodder & Tolley, household names in their heydays but forgotten in the merger frenzy that has significantly narrowed the field.

A visit to New Zealand by his new Elders head office boss, loud-mouthed Australian John Elliott, sealed his resolve to keep it local and have a go himself.

He left his job on May 15, 1986, and within two weeks started trading with others as Property Brokers, initially as a franchise of United Realty World, before establishing Property Brokers in its own right in 1991.

The fledgling Property Brokers had a handful of staff and generated gross revenue of just $220,000 in its first year of trading. Today it has more than 350 staff and is turning over hundreds of millions of dollars in property transactions.

Its generic brand, almost unique in the sector, has opened doors to both residential and rural clients, something opposition companies struggle to replicate.

"We cover the full spectrum of real estate and property management. We're the residential market leader and the rural market leader in our (lower North Island) region.

"You've got to have mixed business, otherwise you're vulnerable."

Mordaunt says he has always been focused on building the business and maintaining a regional focus.

"I knew as soon as I went to Wellington and starting paying $100,000 rent for an office the business would change. Why would you have an office in towns like Pahiatua or Masterton? You just wouldn't and I love supporting the smaller provincial centres."

He attributes the growth of the company to a simple formula; create an environment where sales staff can prosper and the business grows with them.

"It's a partnership, not a line-management thing. If you provide the right environment for your team, they will thrive in it.

"It takes a lot of courage to become an agent, but when they choose to work with you, that's a real privilege for me. They work extraordinarily hard, and I admire the people attracted to our industry and our brand.

"My job is to give the team the best marketing and IT, professional offices, to make sure they have the products to work for us, and good rules. I also aim to keep our standards up, make sure they are proud to work for the organisation and make sure they don't drop the ball or let the team down."

A detailed company manual eliminates 99% of the potential problems that could occur in a sales-dominated staff, Mordaunt says.

"The trick is to keep the focus on front line sales. We're also quicker on our feet than our larger competitors, we've got good products and we adapt quicker. If the momentum is there, then people want to be part of it.

"Property agents get up every morning unemployed. Some days they need a hand-up, some days they need a hand-out. Above all, they need a company that looks after them."

He welcomes the introduction of the new Real Estate Act 2009 because it demands more transparency within the sector.

"Real estate agents have been castigated, unfairly in most cases, in the past. But we welcome more transparency because I know we've got fantastic people, who do things well and have a lot of integrity."

Mordaunt accepts Property Brokers' provincial focus means staff are more visible to the general public than their counterparts in the city.

"In provincial New Zealand if you do something wrong, the whole town knows about it. In provincial New Zealand you have a high profile."

But he says the new Act has put a lot more onus on vendors to disclose information, lessening the unfair criticism agents often faced previously if aspects of a property were revealed after the transaction was completed.

"The new Act does involve more work, it's slowed the (sale) process down and there's more compliance required. But it's also made us more professional."

Mordaunt remains the owner of Property Brokers, however he admits there has been interest over the years from potential suitors for his business.

But while there is growth on the horizon and fun to be had achieving it, he is staying firmly in the driving seat.

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