Key Points
- Los Angeles boutique brokerages brushed off concerns about the Compass and Anywhere Real Estate acquisition, seeing it as beneficial for their independent businesses.
- The merger, a $1.6 billion deal, is expected by some to lead to some consolidation in the industry and could potentially shift agents from larger firms to independent ones due to dissatisfaction with the changes.
- Some executives detailed how the market share play by Compass to control inventory could potentially shake up commission structures.
Compass’ $1.6 billion deal to buy Anywhere Real Estate set off market-share talk across the industry, but boutiques on the high end of the Los Angeles market aren’t sweating it.
Carolwood’s Drew Fenton, CEO and co-founder of Los Angeles County’s fastest-growing boutique brokerage, offered a bullish take via text: “The merger is 110 percent beneficial for Carolwood and other boutique brokerages.”
To be sure, he’s part of an elite tier of L.A.’s high end. This year, he and his Beverly Hills-based brokerage appeared on both of the megadeals tied for priciest in Los Angeles County: 630 Nimes Road in Bel-Air and Spelling Manor at 594 South Mapleton Drive. Both sold for $110 million.
The brokerage firms may be small, but claim an outsized influence in Los Angeles. Among the market’s top 20 brokerages, the nine independents made up a little over one-third of the $51 billion generated between July 1, 2024, and July 1, 2025, according to analysis by The Real Deal of closed deals in the Multiple Listing Service.
Once closed, Compass’ deal for Anywhere will create an entity with about 50 percent share of the market. (Compass and Coldwell Banker Realty alone ranked No. 1 and 2, respectively, in TRD’s most recent ranking.)
There’s plenty of room for the rest of the field with the other 50 percent, said Beverly Hills-based Nourmand & Associates President Michael Nourmand.
“It gives the boutique brokerages a lot of opportunity,” said Nourmand. “The upside is opportunity that there will be movement, that there will be agents that aren’t happy with the sale.
As a result, the merger could shake loose some talent into the laps of independents, but it’s not an apples-to-apples move.
“With this purchase, they’re not buying a boutique and rolling them into a conglomerate,” said Stephen Shapiro, co-founder of Beverly Hills-based Westside Estate Agency. “They’re buying another conglomerate, so the agents are already with Coldwell Banker or Sotheby’s or however many damn names they have.”
On closer examination
The changes one can count on are logistical cuts to reduce operational efficiencies are inevitable and could change the office real estate landscape.
In Beverly Hills alone, Compass, Coldwell Banker Realty, Sotheby’s International Realty and Christie’s International Real Estate each have their own offices. That’s low-hanging fruit to cut two of a brokerage’s biggest expenses: staff and rent, according to Nourmand.
“This is M&A 101,” Nourmand said. “The first thing you do is say, ‘Nothing’s going to change’ and then you slowly make changes, and you try to plan them out and make them incremental enough.”
“They didn’t come and make this bold, risky acquisition to let the brands be independent,” Nourmand added. “You buy companies to make changes.”
Some in L.A. agree, this is a market share play, whether that’s with respect to agent headcount or owning the inventory and getting sellers to place their properties on the Compass listings or Compass Private Exclusives platforms.
If a sizable chunk of inventory sits on a Compass platform, another L.A. brokerage executive said the implications are more than just share. It could lead to the toppling of commission structures as agents know them today.
“This is more about Compass positioning itself to better overturn Clear Cooperation and become a real estate search “portal” with listings no one else has. If this is successful, they will create a direct link with the consumer and use that link to ‘sell’ that consumer back to the agent in the form of a lower percentage of the commission.
“What the agents fail to understand is that this is the first play in a long game to reduce their splits,” the executive added. “I do not expect Compass to admit to this.”
Guessing game
Ask an L.A. executive if they see more acquisitions for the market and the responses are mixed.
“Moves of this scale will certainly accelerate further consolidation across the industry,” The Agency CEO and founder Mauricio Umansky said in a statement provided to TRD. “At the same time, they open even more space for boutique firms like The Agency — where independence, creativity and collaboration allow us to deliver an elevated and deeply personal real estate experience.”
Westside Estate Agency’s Shapiro said he’s not so sure about the M&A wave continuing.
“What’s left? Prudential? There really isn’t much more to consolidate,” he said.
For boutique consolidation, Shapiro doesn’t buy that either. He referenced the initial idea for WEA, which was to structure the brokerage like a law firm where partners divided the profits annually.
“The agents at the larger companies that were successful were afraid to leave the mothership,” he said of the market reception. “They weren’t entrepreneurial. And if you’re talking about boutiques getting together, then who’s the head of that snake? You have a bunch of independent people getting together that still want to be independent and then it becomes the same problem.”
Industry gossip and speculation runs part and parcel with the rush from mega closings. While no one really knows with certainty which way the deal goes, it’s still entertaining for some to ruminate over the what-ifs.
“What do I know,” Shapiro said, “and, furthermore, what do I care? But it’s fun to talk about.”
