Property firms OrangeTee and Edmund Tie & Company are joining forces in a new joint venture that they hope will prove a defensive wall against technological disruption and a rising tide of competitors.
OrangeTee & Tie (JV), as the venture is called, will combine OrangeTee's associate agency division of 2,938 agents and Edmund Tie & Company Property Network's 1,122 agents.
The merger will be completed on Friday and the new firm fully operational on Jan 1, making it Singapore's third-largest real estate agency, said the firms at a joint briefing at the Amara Hotel yesterday.
The move follows the merger in June of PropNex Realty and the Dennis Wee Group's agents, creating the largest agency with close to 7,000 agents, ahead of ERA Realty with about 6,200.
OrangeTee managing director Steven Tan said: "Real estate and the wider economy are going through structural changes. Digitisation and the sharing economy have disrupted many traditional modes of commerce, and the market has responded by consolidating and rationalising."
He noted the traditional property business is still dependent on offline services, and with more technology players coming in, some roles could become redundant unless real estate firms keep up.
For example, property technology firms are trying to minimise "the human interaction with the customers" so there is an urgency to ensure agents are ready for such changes, added Mr Tan.
The combined portfolio means OrangeTee & Tie has more than 50 existing residential projects such as Corals at Keppel Bay, and at least four upcoming launches to work on, including South Beach Residences. There are also more than 50 in-house training programmes and over 1,400 hours of training a year available to agents. The amount each firm is investing in the joint venture and how much their respective stakes are are confidential.
Edmund Tie & Company Property Network's parent firm is a full-service property consultant with experience in project marketing, among other services. OrangeTee calls itself a real estate enterprise and has been focused on harnessing technology.
One initiative is a portal for new property listings. It is also working on a digital platform known as the Property Agents Review that will "list agents' track records for customers to rate and review".
The plan is for agents of OrangeTee & Tie to tap on such technology and get better tools, including access to in-depth research that the two parent firms provide, among other things.
Meanwhile, PropNex chief executive Ismail Gafoor announced yesterday a $5 million training and development roadmap that includes several programmes for both new and existing salespeople. He said: "I believe that, at best, the market today can afford to have only four bigger agencies operating successfully. Over time, only two agencies will eventually dominate the industry."
While the challenging property market has had signs of picking up, Edmund Tie & Company chief executive Ong Choon Fah said the technology platforms and tools for agents are the key to "future proofing" the sales staff.
She noted: "People who are really interested in real estate and sales as a career will take it seriously to upgrade themselves into advisers, so it's no longer being a pure brokerage and buying, selling and leasing of property. Now there are more peer-to-peer platforms, and platforms where tech can cut off the middleman, so we need to reinvent ourselves, otherwise we're going the Kodak way."