Glickman Realty Is Leaving the Westside : Real estate: A sluggish market and stiff competition move founder to close Brentwood office and one that opened in Beverly Hills a few weeks ago.
About 2 1/2 years after its highly publicized launch into the Westside, Mike Glickman Realty Inc. of Woodland Hills said Tuesday that it is closing its Brentwood and Beverly Hills offices.
The residential real estate firm founded by Mike Glickman, a brash, 30-year-old entrepreneur who began his real estate career at age 15, grew to dominate home sales in the San Fernando Valley during the 1980s. But competitors in recent months have claimed that Glickman’s large Brentwood office, which opened with much fanfare in November, 1987, had not lived up to expectations and was losing money.
The Beverly Hills office was opened just a few weeks ago. Glickman said the decision had already been made to pull back from the Westside, but he went ahead with the opening because financial commitments had already been made.
About 120 agents will be laid off as a result of the office closures, and another 15% of the firm’s 1,600-agent work force will be laid off over the next several months, Glickman said.
Glickman blamed the closings, which took effect Tuesday, partly on the home sales market, which has slowed considerably since the heady days of 1987 and 1988. When the Brentwood office was opened, he said, the market was booming and the affluent, rapidly appreciating Westside seemed the obvious place to expand.
“But as the market slowed down, we realized that without having a multi-office chain in the Westside, we weren’t going to penetrate the market as we had in the Valley,” he said.
Glickman, an unabashed self-promoter who until Tuesday denied that the Westside offices were in trouble, also admitted that the expansion failed partly because of his own tunnel vision.
“I personally might have gotten caught up in the excitement of the ‘80s, when bigger seemed to be better,” Glickman said in an interview Tuesday.
Glickman also said that since he turned 30 on March 12 he’s had time to reflect on his past strategy. “It’s time to change,” he said. “Now I want quality instead of quantity.”
Just a few months ago, Glickman denied in an interview with The Times that he was considering closing the Brentwood office and canceling plans to open in Beverly Hills. In a copy of a companywide memo dated Feb. 5 that Glickman made available to The Times, Glickman told his employees: “Our expansion in the Westside has been very successful.” He also said he planned to open more offices in West Los Angeles.
The size of the Brentwood branch, with more than 100 agents and a large, high-profile office on Wilshire Blvd., was criticized by many of Glickman’s competitors when it opened for being overly ambitious. During an interview with The Times shortly after the office opened for business, Glickman said he planned to launch an office “in every major market in the United States.”
Mark Kaplan, who manages the 90-agent Fred Sands Realtors office in Beverly Hills, said Glickman’s pullback from the Westside had long been foreseen. “As he looks back, he’ll see he should have done things differently,” he said.
Kaplan said Glickman is known for hiring large numbers of agents, many of whom have little training. The tony Beverly Hills and Brentwood communities require a very specialized type of service, he said, with clients expecting more hand-holding by agents. “I don’t think the Westside brokers thought his approach would be successful on the Westside,” he said.
Jon Douglas, chairman of Beverly Hills-based Jon Douglas Co., one of the Westside’s largest residential real estate brokerages, said he was somewhat surprised at Glickman’s announcement because Glickman had achieved success so quickly in the Valley. But, he said, on the Westside “you just don’t take 10,000-square-foot offices and hire a bunch of agents. You have to be a little more focused.”
Glickman said the Brentwood office was profitable in the beginning, when the market was booming, but it “has been a financial drain on me for well over 1 1/2 years.”
However, Glickman denied rumors that his company was experiencing financial difficulties and that he was having trouble obtaining financing. “Financially, our only problem was trying to keep the Westside office going,” he said. “Now we’re back in a total profit mode.”
Glickman also said Tuesday that his two Sherman Oaks offices have been consolidated and the company’s fledgling 46-broker commercial real estate division, which was to be based in the Beverly Hills office, will now be run from Glickman’s headquarters in Woodland Hills. The company now has five offices, including a recently opened branch in the Conejo Valley. Glickman said he plans to open a Studio City office within a year and also hopes to expand into the Santa Clarita Valley.
Glickman said about 30 of his 150 Westside agents will relocate to the Valley, and he said he didn’t know if he would ever again attempt such an ambitious expansion. “Right now I’m only interested in doing what I do best, which is the San Fernando Valley,” he said.
BACKGROUND Starting in the real estate business at age 15 by delivering flyers for local real estate agents, Mike Glickman rose quickly in the 1980s to become a dominant force in the Valley home sales market. At age 18, he joined Jerry Berns & Associates as a sales agent, and in 1983 he started his own company, Mike Glickman Realty Inc. in Woodland Hills. Today, Glickman, 30, employs 1,600 agents in five offices in the San Fernando and Conejo valleys.