Century 21’s Commercial Activity Grows

Century 21, the nation’s largest residential brokerage firm, is aggressively expanding into commercial real estate.

Thomas L. Motter, director of commercial and investment services for the Irvine-based real estate firm’s Century 21 of the Pacific Inc. subsidiary, said the region encompassing Orange County and the South Bay area of Los Angeles County, as well as Alaska, Hawaii and Guam, has 14 offices doing commercial business. The company’s objective, he said, is to increase that number to 40 by the end of the year.

To date, most of the commercial growth in the Pacific region has been internal, with existing Century 21 residential franchises opening separate commercial divisions and offices.

But now Century 21 is actively recruiting existing independent commercial brokerages into its franchise system, Motter said.

Since January, he said, Century 21 of the Pacific has brought into the fold its first two commercial brokerage companies, both of which operate offices in Santa Ana.

The first, formerly called Professional Pacific Investments Inc., became a franchisee in January under the name of Century 21 First Commercial Real Estate Services.

Joe Gruenwald, principal of Century 21 First Commercial, said the company moved from Costa Mesa to an office in Santa Ana’s Hutton Centre last month. He said the company currently employs 13 full-time agents and brokers, with an ultimate goal of a 28-person staff.

In February, Hal Butts & Associates, an 8-year-old commercial brokerage firm in downtown Santa Ana, also became a Century 21 franchisee.

Motter said Century 21’s entry into the commercial real estate arena began in the late 1970s as a natural extension of its residential brokerage business. He said a lot of business executives who bought and sold their private homes through Century 21 also asked the company for advice on how to invest their money in real estate. So Century 21 agents began helping them invest in properties ranging from apartment complexes to industrial buildings and raw land.

Nationally, he said, Century 21’s volume of commercial sales grew to $14 billion in 1986 from about $1 billion in 1980. The successful recruitment of independent commercial brokerages as franchises, he said, “signals that we have come of age.”

Motter said that while Century 21 does not yet have the kind of corporate clients that are served by more established commercial brokerages such as Grubb & Ellis and Coldwell Banker, it is involved in increasingly larger commercial deals.

Currently, he said, Century 21 of the Pacific is targeting real estate properties valued between $250,000 and $1 million. “We have to earn our way into that (the commercial) market,” Motter said.