Merrill Lynch & Co., parent company for the nation's largest securities firm, yesterday acquired a majority interest in a fast-growing, 17-office real estate brokerage firm operating in the Annapolis-Baltimore area.
The acquisition of Chris Coile & Associates, a 10-year-old firm with an announced 1979 sales volume in excess of $220 million, marks the entry of the new Merrill Lynch Realty Associates into the Washington-Baltimore area. No purchase price was divulged, but realty industry sources indicated that the cash involved would probably be in the $1 million range.
Chris Coile, 35, president and founder of the Severna Park-based firm that has 300 sales associates, said that he will continue to operate the realty brokerage business under a five-year contract with Merrill Lynch, which recently also acquired major realty firms in Dallas and Pittsburgh.
Despite the current recession, Coile said that he expects total sales volume to exceed $300 million this year.
The Merrill Lynch realty subsidiary, which has an announced objective to acquire 50 major realty firms throughout the nation, is known to have been seeking a Washington-area subsidiary for at least six months.
Coile said that his firm plans this year to open three new offices in the Baltimore area, and is studying the possibility of opening other offices in Prince George's and Montgomery counties. However, both Coile and Weston Edwards, chief executive officer of Merrill Lynch realty operations, agreed that the purchase of the Coile firm does not preclude the future purchase of a major Washington-based multioffice real estate brokerage.
It has been known for months that Merrill Lynch had made unsuccessful overtures to purchase the multioffice Long & Foster firm, which has offices in N. Virginia, nearby Maryland and the District.
Five years ago, Coldwell Banker acquired the multioffice Routh Robbins Real Estate firm. The move was part of an expansion into residential real estate in major cities from a base in Los Angeles.
Meanwhile, national real estate franchising has proliferated here and throughout the nation. In those situations, the ownership remains local but the affiliates use national advertising, training and marketing programs.
Century 21, Red Carpet, Realty World, Better Homes & Gardens, Gallery of Homes and the Washington-based Partners now are operating with relationships to moderate-sized realty brokerage firms in this and other areas. However some of the larger multi-office firms -- notably Shannon & Luchs, Town & Country Properties, Long & Foster, Colquitt Carruthers and the Hugh T. Peck firm -- have remained independent.
In explaining his reasons for selling a major interest in his firm to Merrill Lynch, Coile said that he was motivated by an opportunity to obtain "tremendous benefits in financial resources and national advertising."
Speaking for Merrill Lynch, Edwards said the giant securities conglomerate seeks to add its name and strength to large Washington-area realty firms and "to build incentives without imposing our presence." He added that Merrill Lynch expects to obtain a "carryover" from its realty firms to its operations in securities, mortgage financing, insurance and relocation services supplied to major business firms, including IBM.
Long & Foster has enjoyed a substantial corporate referral business through an affiliation with Merrill Lynch Relocation Service in recent years. The Russell T. Baker firm is similarly affiliated with Merrill Lynch Relocation in the Baltimore area.
In explaining why a purchase price for the Coile acquisition could not be divulged, Edwards said that "each transaction is different." Earlier acquisitions include Dallas-based Paula Stringer Inc. and Hammill-Quinlan Inc. of Pittsburgh.
In 1978, parent Merrill Lynch reported consolidated revenues of $1.5 billion and net earnings of more than $71 million.