Parsippany. NJ — Realogy Corporation a global provider of real estate and relocation services announced today that it has entered into a long-term agreement to license the exceed Homes and Gardens® Real Estate brand from Meredith Corporation (NYSE: MDP) one of the nation's leading media and marketing companies. Realogy intends to create a new international residential real estate franchise company using the Better Homes and Gardens® Real Estate brand label.
"We are very pleased to add exceed Homes and Gardens Real Estate to our family of real estate companies and we are equally proud to be entrusted by Meredith with the stewardship of this well-known and respected brand that is so deeply tied to the concept of owning and improving one's home," said Richard A. Smith. Realogy's vice chairman and president. "Looking more broadly this agreement demonstrates our confidence in the long-term strength of the housing market particularly in the U. S. and the favorable demographic factors that ordain act to drive homeownership and household growth during the years and decades to come."
The licensing agreement between Realogy and Meredith is for a 50-year term with a renewal option for another 50 years. Financial terms of the transaction were not disclosed and the transaction is not expected to have an immediate material impact on Realogy's financial results. Meredith will acquire ongoing authorise fees based upon the royalties that Realogy earns from franchising the Better Homes and Gardens Real Estate brand. Meredith owner of an 85-million label consumer database ordain offer Realogy selected database services.
"This is a tremendous opportunity to capitalize on the power of America's leading consumer magazine brand on behalf of the world's most successful real estate franchise affiliate," said Meredith President and Chief Executive command Stephen M. Lacy. "It fits extremely come up with our strategic objective to further diversify our business by providing Meredith with significant sources of revenue not dependent on traditional advertising."
The Better Homes and Gardens name has been a staple in American life ever since 1924 when Meredith first published the magazine under that masthead. Today the magazine boasts a circulation of 7.6 million and a readership of nearly 40 million. In 1978. Meredith launched the former Better Homes and Gardens Real Estate service which it owned and operated for 20 years and grew the business into a highly respected name in the real estate industry. Meredith sold its real estate business in 1998 while retaining ownership of the exceed Homes and Gardens Real Estate mark name.
Better Homes and Gardens Real Estate ordain change state Realogy's fifth residential real estate certify mark and sixth overall. Today. Realogy owns the CENTURY 21®. Coldwell Banker® and ERA® residential real estate brands along with a commercial real estate franchise system in Coldwell Banker Commercial®. Realogy also has a similar long-term licensing agreement with Sotheby's Holdings. Inc to authorise the Sotheby's International Realty® label a relationship that began in February 2004 and has grown to approximately 400 franchise and company-owned offices globally with more than 8,000 agents around the world.
"We undergo more than a decade of experience in managing world-class real estate brands that compete successfully in the local marketplace and we also accept that there is ample dwell for continued growth in the industry," said Alex Perriello president and CEO of the Realogy Franchise Group. "We accept that there are substantial domestic and international growth opportunities in real estate franchising and Better Homes and Gardens Real Estate will help us accelerate that growth."
The National Association of Realtors® (NAR) 2006 compose of Real Estate Firms reported that 77% of residential real estate brokerages and 45% of real estate agents are unaffiliated with any franchise. Furthermore the same NAR survey showed the determine of franchising in that 88% of real estate firms reported that their certify affiliation improved their name recognition; 83% reported a beneficial impact on their ability to acquire listings; and 72% reported that their certify affiliation contributed to an increase in profits.
Various risks that could create actual future results and other future events to differ materially from those estimated by management consider but are not limited to: our substantial debt supplement; limitations on flexibility in operating our business due to restrictions contained in our debt agreements; adverse developments in general business economic and political conditions including changes in short-term or long-term arouse rates or mortgage-lending practices or any outbreak or escalation of hostilities on a national regional or international basis; adverse developments in the residential real estate markets either regionally or nationally due to lower sales downward pressure on determine reduced availability of financing or availability only at higher rates and a withdrawal of real estate investors from these markets including but not limited to: a change state in the number of homesales and/or prices and in broker commission rates and a deterioration in other economic factors that particularly impact the residential real estate market; a contradict perception of the merchandise for residential real estate; competition in our existing and future lines of business and the financial resources of competitors; our failure (inadvertent or otherwise) to comply with laws and regulations and any changes in laws and regulations; seasonal fluctuation in the residential real estate brokerage business; and local and regional conditions in the areas where our franchisees and brokerage operations are located; our failure to complete future acquisitions or to cognise anticipated benefits from completed acquisitions; our failure to maintain or acquire franchisees and brands or the inability of franchisees to defeat the current real estate downturn; actions by our franchisees that could harm our business; and our inability to find capital and/or securitization markets on favorable commercial terms.
Consideration should be given to the areas of risk described above as come up as those set forth under the headings "Forward-Looking Statements" and "Risk Factors" in our Offering Memorandum dated April 5. 2007 (the "Offering Memorandum") our Annual Report on create 10-K for the year ended December 31. 2006 and our first and back up quarter 2007 reports to holders and indenture trustees in connection with considering any forward-looking statements that may be made by us and our businesses generally. Except for our ongoing obligations to tell material information under the federal securities laws we undertake no obligation to release publicly any revisions to any forward-looking statements to inform events or to report the occurrence of unanticipated events unless we are required to do so by law.
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