Layoff round is part of a larger reorganization strategy to reduce personnel expenses
Real estate and mortgage franchising giant RE/MAX Holdings has laid off roughly 7% of its workforce, including the termination of principal accounting officer Adam Grosshans, as part of a reorganization plan.
The Denver-based company, which listed nearly 600 employees in its latest annual filing, disclosed that it would slash 7% of its staff – equivalent to 42 full-time jobs. RE/MAX said the impacted employees were notified Friday, and the reorganization is anticipated to be completed by the end of September.
Additionally, the company announced the departure of Grosshams, who will be replaced by Leah Jenkins as principal accounting officer and chief accounting officer.
RE/MAX Holdings CEO Steve Joyce cited the challenging market conditions for the reorganization and cost-cutting effort.
“The combination of higher interest rates and tight inventory has made for a challenging housing market and agent-recruiting-and-retention environment,” Joyce said in the company’s Q2 2023 financial report.
RE/MAX’s slumping revenue of $82.4 million in the second quarter (down $9.7 million sequentially), however, was partially offset by growth in its home loan segment – Motto Mortgage.
“On the mortgage side, wemlo is ramping up, and we continue to expand our Motto franchise sales operation,” Joyce said. “The addition of experienced personnel with in-depth franchise experience to our inside sales team is just one reason we are optimistic about increasing the pace of the Motto franchise.”
RE/MAX expects to incur around $2.75 million to $3.25 million in a pre-tax charge for severance and related costs, which will be reflected in its Q3 financial report. The move comes on the heels of another round of layoffs in July 2022, when the firm cut 17% of its headcount, or around 120 employees.
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