Prudential Affiliate Buys John Aaroe
In a deal that creates one of the largest residential real estate brokers in California, Beverly Hills-based John Aaroe & Associates announced Friday it had been sold to a fast-growing San Diego real estate firm for an undisclosed price.
The deal between John Aaroe and Pickford Realty--which does business as California Prudential Realty in San Diego and Orange counties--gives rise to a regional giant with about 2,500 agents and more than $7 billion in annual property sales in coastal Southern California.
Broker John Aaroe and business partner Alan Field--who founded the firm less than five years ago--will remain with the company as managing partners and continue to run its Los Angeles operations. The company will be renamed Prudential John Aaroe & Associates.
“There are tremendous parallels between Pickford and our company,” said John Aaroe, whose firm focuses on the middle and upper ends of the real estate market. “We are a powerful force in this market.”
Steve Games, co-owner of Pickford, said the John Aaroe acquisition fits into its strategy of expanding into affluent residential communities. Last year, for example, Pickford purchased Ellis Realty of Newport Beach. Pickford operates as a franchisee of Orange County-based Prudential Real Estate Affiliates Inc.
“We were seeking the opportunity to reenter the Los Angeles-Westside market, which is complementary to La Jolla and Orange County markets,” said Games, who founded the firm in 1985. Pickford’s other owner is Nyda Jones-Church.
Prudential has lacked a presence in the area since September 1997, when Beverly Hills-based Jon Douglas Co. ended its relationship with Prudential Real Estate Affiliates. A few days later, the parent of Coldwell Banker Residential Brokerage bought Jon Douglas.
“There was a tremendous vacuum and they’ve talked to everybody [about an acquisition], including us,” said competing broker Fred Sands. “It’s a good move for Prudential.”
The sale surprised many Aaroe agents, most of whom had come from brokerages that were swept up in the wave of mergers. Aaroe himself had said the firm--which sold more than $1 billion worth of properties last year--wasn’t for sale and promoted its role as an independent, locally owned operation.
“Everybody was surprised,” said Isaac Fast, an ex-Jon Douglas agent who joined Aaroe’s Los Feliz office last year. “But overall it looks like it’s going to be business as usual.”
Aaroe, who broke the news in person to agents in each of the firm’s five offices, said the economies of scale with a larger operation will put the firm in a better position to provide the services many clients are demanding. In addition, the deal will allow Aaroe’s company to tap into Prudential’s corporate relocation business, agents said.
