ATLANTA-RADCO is looking beyond the world of distressed assets with a new company. Dubbed R4, the new real estate sales and marketing firm is poised to serve builders, banks and other lending institutions around the country.
RADCO has the experience. The company has managed more than $4 billion in real estate assets over the past 16 years, including condos, multifamily rentals, mixed-use properties, resorts, and master-planned communities.
“That RADCO machine is a stand-out, and it deserves to be a stand-alone as well,” says Norman Radow, RADCO’s founder and CEO. “A development does not need to be in distress to desire the highest and best results of its sales and marketing team.”
Led by Principal Kevin Price, the R4 team arranged more than $100 million in property sales in each of the last three years operating as RADCO’s sales and marketing arm. Those are impressive stats given that 2008-2010 have been three of the most challenging years in the history of residential real estate.
“During the boom years, real estate sales and marketing firms turned into order takers. They got soft. They forgot how to be strategic and thoughtful and aggressive and creative,” Price says. “R4 was born within RADCO because we couldn’t satisfy our very high level of expectation with outside vendors.”
Jack McCabe, principal analyst at McCabe Research & Consulting, isn’t surprised that RADCO is spinning out R4. He tells GlobeSt.com he watched brokers and entire brokerages shift gears and become distressed property experts at the height of the meltdown, and now that trend is reversing itself.
“Brokers are seeing that the window for making a lot of money off marketing distressed properties may be nearing an end,” McCabe says. “Perhaps by the end of 2011 the market is going to be in better shape. So they are trying now to rebrand their companies or start new companies without the emphasis on being distressed property experts.”
Will R4 succeed as a standalone company? It’s too soon to tell, but just because it succeed within RADCO is no guarantee in and of itself. That, McCabe says, is because success in sales and marketing over the last few years has been more a result of pricing than it has sales and marketing expertise.
“Generally the lowest priced distressed properties are the ones that are moving and the higher priced properties were not,” McCabe says. “They may have been very effective in setting prices correctly to be highly competitive in those marketplaces. Whether that is going to translate into future success in a more competitive, positive marketplace remains to be seen.”
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