Douglas Elliman sold its property management business and plans to use the proceeds to cut its debt load.
Douglas Elliman is primarily a luxury residential brokerage firm.
PMG Holdings, a subsidiary of property management giant Associa, paid $85M to acquire Douglas Elliman Property Management, according to a filing with the Securities and Exchange Commission. Proceeds from the deal will be used to pay off $50M in convertible debt.
Douglas Elliman’s board of directors unanimously approved the deal and entered into a purchase agreement Friday covering all of the equity interest in the property management business.
It is the latest in a string of mergers and acquisitions across the real estate services landscape, led by the $1.6B acquisition of Anywhere Real Estate by Compass.
Douglas Elliman is using cash from the sale to pay off a $50M loan from New York-based asset manager Kennedy Lewis Investment Management that the brokerage took out in 2024 to fund expansion plans. The senior convertible notes came at a 7% interest rate and had a 2029 maturity date. Douglas Elliman is paying a combined $95M to exit the loan, according to the filing.
David Chene, a Kennedy Lewis principal, joined the board at Douglas Elliman as part of that deal and is leaving following the loan’s payoff. Chene recused himself from deliberations and votes about the potential sale, and Douglas Elliman said in its SEC filing that the split was amicable.
“The resignation did not result from any dispute or disagreement with the Company or the Board,” the filing says.
PMG secured a five-year licensing and noncompete agreement where it can continue to use Douglas Elliman’s brand, and the brokerage firm agreed not to pursue new property management deals in New York, Texas or other markets where the Richardson, Texas-based Associa operates.
Douglas Elliman’s property management business pulled in $20M out of $525M in revenue for the first half of 2025, according to earnings reported on July 31. Its business spanned nearly 400 buildings in New York City, according to a mid-2024 press release.
The real estate services firm reported an operating loss of $5.5M for the second quarter, up from $3.7M during the same period a year prior.
Douglas Elliman had roughly $130M in cash at the time of the sale, according to the SEC filing, down from the $136M in cash it had at the end of the second quarter. Its stock was up more than 1 percentage point in early trading Monday and has gained nearly 70% year to date, driven by revenue despite operating losses.
The deal comes as M&A activity picks up in the real estate services sector. In addition to the Compass and Anywhere merger, Cresa this month acquired its biggest direct competitor in the occupier-focused advisory space.
CBRE, the globe’s largest commercial brokerage firm, started the year with the acquisition of coworking firm Industrious at an $800M valuation, and in August it bought a stake in sustainable energy firm ClearGen.
CBRE paused stock buybacks in the third quarter after repurchasing $663M in shares in the first half of the year, which Chief Financial Officer Emma Giamartino signaled may be because it was building up cash for another purchase.
“I can’t comment on particulars of what we’re targeting, but we continue to focus on the areas of our business that are resilient, that can benefit from secular tailwinds,” she said on the firm’s Oct. 23 earnings call.