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TenX to Take On The Online Agencies In Real Estate

Two San Diego real estate veterans have joined forces to create a new agency that aims to help real estate agents compete against online brokerages, keep up with technological changes in the industry and keep more of their commissions.

Burke Smith, former chief strategy officer for Realty ONE Group based in Irvine, and Spencer Lugash, a founder of Big Block Realty based in San Diego, have formed TenX Realty, with headquarters in Carlsbad and offices in Escondido, Mission Valley and Rancho Bernardo.

Smith said he operated four brokerages in San Diego County as Realty ONE Group franchises, which have become the TenX offices.

In a business where agents have to compete against online offerings such as Zillow, “We’re choosing to offer ways to help agents get back to the basics,” Smith said. “We decided that there’s still opportunity for good, experienced agents to be successful. They just need to be empowered to provide more value to their clients. There’s still that personal touch. We like to remind our agents that you can’t shake hands with a Facebook page. You can’t shake hand with a computer.”

Lugash is a real estate lawyer who said he co-founded Big Block Realty in 2008 and left the company in August 2018.

Expects to Handle $1B in Sales

Smith said he expects TenX will handle $1 billion in sales in 2020.

“Spencer and I created TenX Realty to really be the main advocate for real estate professionals in a world where real estate has gone very tech driven,” Smith said. “We decided to focus on the real estate professional and create an environment where they get legal support, marketing and tech support and do it all in the most advantageous compensation model in the market.”

A key attraction TenX has for agents is that it charges a flat fee rather than taking a part of their commission, Lugash said.

Traditionally, brokerages would charge agents a percentage of the commissions they collect on sales.

The amount of the fee varies, depending on the amount of the sale.

Annual Fee

TenX charges an annual fee of $5,000 rather than take a share of the commissions.

“The agent can pay upfront and they don’t have to worry about any other fees,” Lugash said. “If they don’t want to pay upfront, we will take it out of their transactions up until they reach their $5,000.”

Until the $5,000 is reached, TenX charges a flat fee of $500 per transaction for deals that are under $600,000 and $1,000 for deals that are more than $600,000, Smith said.

For deals over $2 million, there’s an additional fee of $100 for every additional $1 million.

Even so, that’s far less than agents would pay under traditional arrangements where agents pay a share of their commissions, Smith said.

‘Coworking Space’

“In the past, that has been looked at and confused with what has been deemed to be a discount broker. That is not what we are,” Lugash said. “We are full service.”

Agents working through TenX can work out of TenX offices, using them as a kind of coworking space with administrative support.

“The agents can come in and use any of the offices, it’s a plug and play model for them,” Smith said.

TenX also offers training sessions on generating and managing leads and provides contact management systems, Smith said.

“My expertise is in lead generation and lead conversion,” Smith said.

The flat fee model isn’t unique to TenX, but Lugash said the firm combines his legal talent and experience with Big Block with Smith’s marketing skills.

“There are other companies out there with this model,” Lugash said. “What separates us is that training, that support.”

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