Yahoo Finance Knight Frank’s KF Property Network is Singapore’s fifth-biggest agency
Tan: We decided to focus on marketing projects in the Core Central Region and Rest of Central Region
The spate of agency mergers this year may have indirectly benefited some of the medium-sized firms — for instance, Knight Frank’s agency business, KF Property Network. It is now the fifth-largest agency, with 662 agents, according to the Council of Estate Agencies (CEA) public register. However, if the agents pending approval by CEA were included, the number would increase to 735, says Tan Tee Khoon, head of KF Property Network.
Unlike the recent mergers, the relisting of ERA’s brokerage business is unlikely to have a direct impact on the rest of the real estate agencies. “Perhaps for the agents of ERA, it’s an opportunity to own a small stake in the company by subscribing to its shares,” says Tan.
‘Shark-eat-shark world’
In Singapore, the real estate agency business has been described as a “shark-eat-shark world”. In the past, agents used to earn a fixed salary and a portion of the commission, which would be shared 60:40 between the agent and the firm. When ERA entered the business 35 years ago, the commission for agents increased to 70%, with the agency taking 30%.
Increased competition also led to some of the more aggressive agencies adopting a 90:10 commission structure, with 90% of the commission going to the agents, and the agency retaining 10%. That has now become the industry norm for agents who have hit their financial targets. “With such thin margins, it was just a matter of time before mergers and acquisitions between agencies happened,” says an industry veteran.
Staying niche
Knight Frank Singapore, which turns 77 this year, decided to focus on its longstanding relationships with property developers. Given the size of KF Property Network, it focused on its — when it came to project launches, says Knight Frank’s Tan. “The projects in the Outside Central Region require a huge sales force, so we decided not to compete in that space.”
This year, Knight Frank was appointed one of the marketing agents for the launch of the 400-unit Artra condominium adjacent to the Redhill MRT station, and Park Place Residences at Paya Lebar Quarter. It is also the marketing agent for TwentyOne Angullia Park and The Nassim. The firm has been appointed one of the marketing agents for the Serangoon Ville site by a consortium led by Oxley Holdings, and for a new project at West Coast Vale by CSC Land, China Construction (South Pacific) Development Co’s property development arm.
Top 10 real estate agencies based on number of salespersons
No | Estate agency | No of salespersons |
1 | Propnex Realty | 6,881 |
2 | ERA Realty Network | 6,283 |
3 | OrangeTee & Tie* | 4,112 |
4 | Huttons Asia | 3,243 |
5 | KF Property Network | 664 |
6 | SLP Realty + Scotia Real Estate Group | 653 |
7 | Savills Residential | 636 |
8 | Global Alliance Property | 615 |
9 | HSR International Realtors | 478 |
10 | C&H Properties | 381 |
*Based on combined number of salespersons at OrangeTee & Tie and Edmund Tie & Company Property Network
Source: CEA Public Register as at Oct 5
This article, written by Cecilia Chow, appeared in EdgeProp Pullout, Issue 799 (Oct 2, 2017)
Edit : The table was updated on Oct 5, 2017, to include SLP Realty and Scotia Real Estate Group, which were previosuly omitted. The error is regretted.
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