Buffett's company buys Harry Norman Realtors

ATLANTA — Harry Norman Realtors, Atlanta's third-largest independent residential real estate firm, has been sold to a company affiliated with Berkshire Hathaway, billionaire investor Warren Buffett's holding company.

Minneapolis-based HomeServices of America bought Harry Norman — its second Atlanta acquisition — for an undisclosed sum, ending years of courtship by a variety of national companies for a stake in the 76-year-old firm.

Currently, Harry Norman has 20 offices and almost 1,200 agents. In 2005, the company closed more than 9,400 transactions worth a total of $3.6 billion.

HomeServices, the nation's second-largest full-service, independent real estate firm, bought Jenny Pruitt & Associates in October 2001. Both Harry Norman and Jenny Pruitt will continue their metro-recognized brands as independent operations under their own names.

HomeServices was created in 1998 when MidAmerican Energy Holdings Co., a subsidiary of Berkshire Hathaway, purchased Edina Realty and Iowa Realty.

The Harry Norman sale is part of a national trend toward consolidation in the real estate industry, Harry Norman President Lewis Glenn and HomeServices Chief Executive Ron Peltier said Tuesday during a media conference.

The move, they said, will strengthen and expand Harry Norman's operations without cutting its work force or diluting its longstanding community identity.

"We're not a franchise," Peltier said. "We do not represent a one-size-fits-all mentality."

What the national affiliation does provide to Harry Norman is support services and business tools that can be costly for a smaller operation to maintain. The national company can provide access to some of the latest technology during an age when the vast majority of home sales begin with an online property search.

Jenny Pruitt, founder and CEO of the company that still bears her name, said HomeServices deepened the company's resources and vastly improved its Web site.

"They brought a lot of technology to the table," Pruitt said.

But she stressed that HomeServices has honored its commitment to continued local control of the company's day-to-day operations.

HomeServices also will extend Harry Norman's ability to provide under one roof a full range of services that home buying requires, including mortgage lending, title and closing services, home warranties and insurance. Peltier compared this to the expansion of retail outlets into everything from banking to groceries to medical examinations in one location.

"As the market continues to evolve, pure brokerage is not a sustainable business model," Peltier said.

Glenn said the technical and administrative support HomeServices can provide will allow Harry Norman to thrive in a highly competitive market awash in dramatic demographic change. Increasing needs for relocation services, growing numbers of resettling immigrants and more complex patterns of age-driven home preferences will favor companies that can understand and tailor real estate sales to a host of specialized needs, Glenn said.

Young adults want to buy condos, empty nesters are downsizing and the second-home market is booming, Glenn noted.

"We've got to understand generational trends more than ever before," Glenn said. Affiliation with a national company can provide deeper research and marketing expertise to tap these home-buying trends, he added.

The extension of HomeServices' reach in the Atlanta market underscores the metro area's ongoing attractiveness to national real estate brokers and developers as many formerly explosive real estate markets, such as California and Florida, show signs of stagnation.

"This is a huge market," Peltier said.

"And its best years are ahead of it in every way."

Julie B. Hairston writes for the Atlanta Journal-Constitution.