Coldwell Chief Celebrates New Independence
James J. Didion beamed and gave a thumbs-up sign Wednesday afternoon in the 10th-floor board room of Coldwell Banker’s headquarters in downtown Los Angeles.
After months of painstaking negotiations with U.S. and Japanese investors and several days and nights of signing documents, Didion and an investor group had finally succeeded in buying Coldwell Banker Commercial Group from Sears, Roebuck & Co. for about $300 million.
And there was no mistaking Didion’s relief that his company, of which he is chairman and chief executive, was independent again after seven years as something of a stepchild to Sears, the retailing giant and aspiring financial supermarket.
Sears decided last October to sell the commercial real estate division of Coldwell Banker as part of a corporate overhaul to refocus Sears’ energy strictly on consumer businesses and, observers said, avoid a takeover.
“Sears did some good things (for Coldwell Banker),” the ruddy-faced, gray-haired Didion acknowledged in an interview. “But the lack of strategic importance that we had to them” proved a decided disadvantage when it came to trying to branch out into some new businesses.
Throughout Coldwell Banker Commercial Group’s tenure with Sears, Didion noted, the profitable unit never borrowed any money from Sears and, in fact, pumped profits Sears’ way.
Now, he said, gloating a bit, “we’ll just lop off the top and won’t send money to Chicago anymore. Life after Sears, I think, is going to be exciting.”
The idea is for Didion, a Sacramento native and younger brother of author Joan Didion, and his colleagues at Coldwell to run the show free of interference from the outside investors. They include Japanese interests and Carlyle Group, a Washington investment firm run by Frederic V. Malek, a former Republican Party official who vows to keep his hands off day-to-day operations.
A key element of the deal, and a longtime dream of Didion, is employee ownership. Under a planned public offering, Coldwell Banker’s 5,000 employees from all levels will have a chance to own half the company.
He has made videos that were shipped out to Coldwell Banker’s many offices to explain the deal. Employees dubbed the tapes “Dideos.”
Didion said Coldwell Banker plans to expand in its primary roles as a real estate broker and property manager. Negotiations on joint ventures in Asian markets, including Tokyo and Hong Kong, will begin soon.
Domestically, after 20 years of expansion, the company has begun paring back, consolidating offices in Florida and Texas. Earmarked for consolidation locally are the Santa Ana and Anaheim offices. The company said it expects no layoffs.
An Avid Golfer
An avid golfer with a five handicap, Didion said he has been too busy to even touch a club for six months. In his office is a signed photograph of country singer Willie Nelson. Years ago, Didion won a Nelson-sponsored golf tournament in Texas.
Didion, 49, lives weekdays in his downtown Los Angeles condo and spends weekends at a home in Pebble Beach.
But Didion said there is no time to rest. One of his first tasks, he joked, will be to send a telegram to a competitor that has advertised itself as “America’s largest independent real estate services firm.”
Didion noted that Coldwell Banker’s new independent status makes that claim obsolete.