Realtor associations plan to sell REcolorado multiple-listing service

GREENWOOD VILLAGE— The Denver Metro Association of Realtors and the South Metro Denver Realtor Association, which jointly own REcolorado, have a preliminary deal in place to sell the Denver-area multiple-listing service. 

“After extensive conversations with the respective boards, including research and evaluation” DMAR and SMDRA leaders “have agreed in principle through a letter of agreement to sell (REcolorado) to a private entity,” the associations said in a joint statement to BizWest. 

The Realtors associations did not provide any details about the potential buyer. 

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“This is a decision that our respective associations agree will help provide expanded and improved service opportunities for metro-Denver Realtors and licensees, the members of our associations and REcolorado subscribers that depend on the MLS to provide the vital market information required to best serve consumers in their home buying and selling process,” the associations said. 

Real Estate News reported that some leaders at REcolorado, a Greenwood Village-headquartered broker-to-broker network that claims to facilitate more than 75% of all real estate transactions in Colorado, have concerns that the business will not operate as a MLS in the long term and that there is “bad blood” between REcolorado and its Realtor association owners.

“Having completed our due diligence as shareholders, we feel confident in the letter of intent and that the proposed buyer has committed to the long-term operation of the MLS service for our professional brokerage community and that the resources of the MLS will be used to enhance the service offerings to all subscribers and that the company will not be resold,” the associations said. 

One of the motivations for the sale is legal protection against antitrust allegations, DMAR and SMDRA said.

“We strongly believe that this is the right time to sell the MLS, as the industry continues to advocate decoupling from the Realtor associations that have long owned the MLS. As has been widely reported in industry reports and media coverage, decoupling MLSs and Realtor associations could help protect MLS organizations from ongoing antitrust litigation,” REcolorado’s owners said. “Separating could also improve MLS management, according to the latest Swanepoel Trends Report, which also recommended that MLSs be structured as for-profit businesses, while Realtor associations should be nonprofit organizations.”

SMDRA and DMAR said that “additional details regarding the buyer and agreement will be announced soon,” but “due to the legal obligations of the LOI and our process, we cannot comment further at this time.”

Correction: This story has been updated to correct the city where REcolorado is headquartered.