Elliman shareholders back embattled chairman Howard Lorber; Fed chair signals September rate cut... and more

The best national real estate stories from The Real Deal Aug 24, 2024 [View in Browser]( | [$1 for 1 Month]( [The Real Deal Logo](   [The National Logo](   In this week’s newsletter, we take a look at Douglas Elliman shareholders’ support of chairman Howard Lorber. Plus, interest rate cuts are imminent, Kamala Harris promises to build three million homes, and a prominent NYC developer is accused of sexual assault. These stories and more below.   Douglas Elliman shareholders back embattled chairman Howard Lorber The residential brokerage industry is under fire on multiple fronts. It’s facing scrutiny as new NAR rules take effect, the market has been unstable as the economy remains uncertain, and brokers’ bad behavior has given firms heaps of bad press. At prominent brokerage Douglas Elliman, chairman Howard Lorber is at the center of the storm. Elliman reported its [eighth consecutive quarterly loss]( in June, though the second-quarter loss of $1.7 million was a marked improvement from the previous quarter’s staggering $42 million loss, punctuated by a $17.75 million settlement payment over antitrust lawsuits. Earlier this year, the company’s stock price hovered just above $1 – risking delisting – but it has since climbed to just under $2 as of Friday afternoon. Elliman’s financial struggles have been a consistent concern since its [2021 spin-off]( from parent company Vector Group, which announced this week that it’s being [bought by Japanese tobacco giant JT Group]( for $2.4 billion. (Lorber, who still runs Vector, stands to gain an estimated $46 million from that deal.) So it’s no surprise that Lorber has some critics right now. Those financial losses have been the primary critique, but investor Brad Tirpak detailed more issues with the chairman leading up to a shareholder meeting that was held on Wednesday. In a [letter to shareholders](, Tirpak called out Elliman for lowering the financial benchmarks for executives to receive bonuses and raised concerns that Lorber received the full amount of the diversity, equity and inclusion portion of his bonus despite [sexual assault and rape allegations]( made against former top executives Oren and Tal Alexander. Lorber and other top execs took home a hefty bonus last year while the company’s cost-cutting mantra led to layoffs and cuts to bonus packages for other employees within the company. A week before the meeting, advisory firm Institutional Shareholder Services recommended shareholders [withhold votes on Lorber](, whose contract was set to expire in December. But in the end, Tirpak couldn’t [flip shareholders](. Lorber secured his seat on the board and his comp package, which includes a multimillion-dollar bonus. The votes do suggest the letter [may have had some impact]( – Lorber was elected with 70 percent of the vote, while two other board members received 88 percent. So while he’s out of the immediate hot water, Lorber is still looking to [rate cuts for relief](, like much of the industry. In a recent earnings call, he noted that inventory rose in Florida and Texas, but the increase hasn’t yet translated to unit growth as elevated interest rates continue to deter buyers across the country. The Federal Reserve is [expected to begin cutting interest rates]( after its meeting in mid-September, and there is cautious optimism that the market may improve, potentially providing a lifeline for Elliman. And though Lorber can breathe a sigh of relief now that his seat on the board is secured, that seat will likely stay hot until the company can turn a profit.   Together with Energy CX 68% of CRE owners overpay for energy. Do you? [EnergyCX]( Join the largest Commercial Real Estate companies in the country who no longer overpay for energy. [Learn more.](   [I'm an image]( “Time has come”: Fed chair signals September rate cut After weeks of speculation, the Federal Reserve’s much-anticipated interest rate cuts appear to be imminent. [I'm an image]( Kamala Harris’ plan to build homes: reality or fantasy? Vice President Kamala Harris pledged to build three million new homes in her first term if elected president. [I'm an image]( Dov Hertz settles accusation by babysitter of sexual assault decades ago Developer Dov Hertz has settled a lawsuit by a Brooklyn woman who accused him of sexually assaulting her more than four decades ago, when she was a teenager babysitting for his family.   Advertisement   [I'm an image]( Chelsea development in limbo because Brandon Miller died without a will A friend who lent the late Brandon Miller $1.5 million secured by Miller’s interest in a Chelsea development is now stuck in limbo because Miller apparently left no will when he died. [I'm an image]( Chicago’s most-expensive home sold at $50M loss to sellers The most-expensive home sale in Chicago this year came at a steep loss to the seller after spending years on the market. [I'm an image]( House-flip firm in escrow on Kanye West’s gutted Malibu digs A crowdfunding firm that has flipped homes since 2018 said it’s in contract to buy Kanye West’s gutted Malibu home at a big discount. [I'm an image]( Buyers sue developer of long delayed Mandarin Oriental Boca Raton The buyers expected to close on their luxury condos in 2021, now they want their millions of dollars of deposits back. [I'm an image]( Multifamily deals return, but Texas lags other markets — for now Sales are still well below last year, but they're trending up.     [The Real Deal Logo]( [Facebook]( [Twitter]( [Instagram]( [LinkedIn]( [YouTube]( [Manage Newsletters]( | [Unsubscribe]( | [Privacy Policy]( | [Subscribe]( | [Advertise]( The Real Deal 450 West 31st Street, New York, NY 10001 ©2024 TheRealDeal. All rights reserved. [View Online](