A Piece Of The Pie: CRE Ownership Structure Is A Win For Houston Brokers And Clients

10 years ago, commercial real estate brokerage Lee & Associates expanded its national presence by opening the doors to its 55th office, in Houston, Texas, with four CRE professionals and an assistant at the helm. Among the CRE professionals was Managing Principal Chris Lewis, who runs Houston’s office division.

Lewis said that while Lee & Associates had a strong presence in California and the East Coast at the time, the Houston office opened to fulfill a need for the brokerage’s emerging footprint in the middle of the U.S. 

“Starting a brand or expanding new brands in the market is extremely tough,” Lewis said. “In the early years, it was quite hard to compete with the local players, being a new name to the Houston market. We invested significant capital in public relations, marketing, articles and interviews just so people knew that we were out there.”

Fast-forward a decade later, the Houston office has expanded to more than 100 employees, including more than 45 brokers, and helped facilitate the opening of other offices near Houston, such as the Baton Rouge and Lafayette, Louisiana, markets and additional Texas markets. The key to its growth has been in implementing Lee & Associates’ unique financial structure combined with the collaborative nature of the leaders and partners in Houston, Lewis said.

As the largest broker-owned CRE company in the nation, the Lee & Associates structure means that the brokers of a particular office are the owners of that office. Brokers who become principals can share in the profits of the local office and new offices that open thereafter nationally. 

“It’s a highly attractive wealth-building model for an agent who would otherwise not be able to reach profits outside their markets in their company,” Lewis said.  

Lee & Associates Managing Principal Mike Spears joined the firm in 2016 along with 18 brokers from his old firm. Spears, who runs the brokerage’s industrial division, said that more brokers today are seeking opportunities to become decision-makers.

“Brokers get to a point where they want to keep growing and want a seat at the table,” Spears said. “Lee provides this growth opportunity and a very clear path to partnership.”

Lewis and Spears were drawn to Lee & Associates’ national reach to help clients who are either based in Houston and want to expand to other cities or national clients who are looking to do business in Houston. 

“With Lee & Associates’ huge network, we have a tremendous amount of firepower,” Spears said. “We have the ability to operate in multiple cities and states and capitalize on the synergy that happens between Houston and other markets.”

Lee & Associates’ office division represents landlords and tenants. The office landlord agency approach differs from that of larger companies. 

“Rather than being mandated to focus solely on archaic processes of our competitors, the brokerage is much more technologically advanced and nimble,” Lewis said. “It has the ability to serve all types of clients, large or small, offering all the same resources.”

As Lee & Associates’ office is broker-owned and operated, the brokers themselves can allocate money on resources that would best serve their clients. 

“Agents at competitive firms may be capital-constrained with clients, due to the firms’ inability to allocate funding toward marketing or asset promotion, for instance,” Lewis said. “We offer flexibility for each client instead and can allocate proper investment into our assets with a short decision process and our ability to be nimble. We can also mobilize these resources quickly and professionally for any listing and provide performance metrics.”

Spears said that having this breadth of resources has been essential for industrial clients as well.

“If there's a resource out there that can help us bring our very best to our clients and develop that long-term relationship, we’re going to go for it,” Spears said. “We provide them with every tool they need for their business. We treat our clients like partners.”

Reflecting on the past decade, Lewis said that “everything has changed” within the office in the last 10 years, which have largely been about establishing new lines of business, growing its team and putting systems in place such as having a board of directors, internal committees, coaches, counselors and consultants. 

“It takes an army to make it work and persistence to do it right,” Lewis said. “We always want to stay nimble, be client-focused and get results."

He said Houston’s upcoming goal is doubling revenue while ensuring that its team and clients align with its culture.

Spears called the decision to join the Houston office “the best decision” and is enthusiastic about what’s in store.

“It’s been a fun trip getting to where we are now, and I’m looking forward to seeing what the next 10 years bring,” he said.

This article was produced in collaboration between Lee & Associates and Studio B. Bisnow news staff was not involved in the production of this content.

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