218 Office Estate Agency Sold for £1
Perhaps it’s a sign of the times. Perhaps it’s a sign of the credit crunch. And perhaps it’s the biggest sign of just how desperate things have become in the recession, when one of the most renowned and respected of high street estate agency businesses is sold for less than the price of a bag of sweets.
The Halifax is very well known to the house buying British public, because there is a branch in just about every shopping centre throughout the UK. A few years ago the bank developed a satellite business and became involved in selling properties, just like any other high street chain of estate agents. Halifax Estate Agents was successful during the boom years and operated from 300 offices with over 1,500 employees. But the credit crunch and property market collapse caused the agency to produce ruinous trading figures and it has consequentially been operating at a loss now for some time.
The bank should probably have stuck to what it was (once) considered to be good at, rather than trying to step on the toes of other businesses. Merging the once clear-cut boundaries between banking and estate agency did The Halifax no favours whatsoever and it quickly fell victim to misdirected management and inappropriate attempts at broadening its business base.
In a blaze of publicity, the Lloyds Banking Group purchased HBOS last year – and inherited the Halifax Estate Agency as a result, which it has since decided it doesn’t want to keep. In fact, it has sold the agency to LSL Property Services for just £1. Yes, you read it right, just £1. Less than many give our children to buy a bag of sweets. The new owner intends to take 1,050 of the Halifax Estate Agency’s staff, which it will employ amongst the 218 branch offices. But the Halifax has also said it will need to axe 460 jobs ahead of the transfer as part of the deal.
Meanwhile, LSL Property Services has said it will rebrand the estate agency chain and rename the existing high street offices as Your Move, Reeds Rain or Intercounty. The addition of these offices will make LSL the second biggest chain of estate agencies operating in the UK, pushing Connells into third place and staying marginally behind the front leader Countrywide. Whether this is going to prove to be a good or bad move, only time will tell. Every estate agency in the top ten league of network chains closed offices during the year 2008 to 2009, with LSL itself closing 82 and Countrywide closing 72. The Halifax Estate Agency group closed more than any other estate agency, losing 84 branch offices in all, but clearly this action alone wasn’t enough to thwart a disastrous financial year.
It’s interesting to note that the sell-off by Lloyds may not be entirely all down to the credit crunch, because ever since the bank purchased Halifax and Bank of Scotland, it has attracted criticism from the EU who became concerned over its dominance in the banking marketplace. The EU has suggested on several occasions that it may have to take action to break-up the iron-might of Lloyds in the high street – and it’s widely thought the sell-off of the Halifax Estate Agency arm might just appease the EU and prevent a more formal retort from the commission.While few members of the great British public ordinarily have sympathy for the suffering of estate agents in a recession, the loss of 121 bank counters from our towns and cities caused by the estate agency sell-off, may spark concern. The closures have been programmed to begin early in the New Year.
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