Luxury Real Estate Giants Collaborate to Launch Private Escrow Firm in Beverly Hills

Description : “Top agents from Westside Estate Agency and Carolwood Estates partner to open Private Escrow, a new business in Beverly Hills. Learn how this unusual collaboration is set to revolutionize the upscale residential market.”

Content:

In a groundbreaking move, two leading luxury boutique agencies in Beverly Hills, Westside Estate Agency (WEA) and Carolwood Estates, have joined forces to establish a new business venture named “Private Escrow,” as revealed by The Real Deal on 25th July 2023.

The mastermind behind this innovative partnership is Gail Hershowitz, a highly experienced escrow officer and a favorite among agents at both WEA and Carolwood Estates. Formerly the manager at Escrow of the West, Hershowitz brings unparalleled expertise to the table.

What sets this collaboration apart is the fact that these two prestigious brokerages often compete directly for exclusive listings and affluent buyers in Los Angeles’ upscale residential market.

In an interview, Hershowitz expressed her surprise at not knowing of any similar ventures where agents from rival brokerages collaborated to establish a separate escrow business. Private Escrow’s partners from WEA include Kurt Rappaport and Stephen Shapiro, while Drew Fenton and Nick Segal represent Carolwood Estates alongside Hershowitz herself.

Segal, the managing broker at Carolwood Estates, assured that there would be no conflicts of interest arising from this partnership. He emphasized that they hold deep mutual respect for each other and that the collaboration made perfect sense.

The idea of developing an independent escrow company was initially pitched to Hershowitz by Carolwood Estates in January. Recognizing WEA’s significant contribution to her business, Segal suggested including them in the venture to ensure harmony. The collaboration was driven by shared interests among the boutique agencies and Hershowitz’s strategic objective of establishing closer ties with top brokerages that were not already affiliated with a favored escrow company.

Heading Private Escrow marks a significant milestone in Hershowitz’s career. The firm currently employs four people, with plans to expand the team in the near future.

The escrow industry faces challenges, particularly for independent companies. Hershowitz pointed out that few independent escrow companies remain due to the difficulty of attracting business without an affiliation. However, both Stephen Shapiro and Kurt Rappaport of WEA expressed optimism, highlighting the potential profitability of the new escrow company. With a combined gross sales figure of $3.5 billion to $4 billion, funneling a substantial portion of their business into Private Escrow could turn it into a lucrative profit center for the partner brokerages.

Shapiro and Rappaport have enjoyed a professional relationship with Hershowitz spanning over 25 years. They attributed their interest in this association to Hershowitz’s initiative, acknowledging that without her involvement, the collaboration might not have materialized.

It’s important to note that agents are independent contractors and are not obligated to use Private Escrow’s services. This collaboration represents a strategic move to expand the brokerages’ offerings and develop closer bonds with clients.

Michael Nourmand, chief of independent Beverly Hills brokerage Nourmand & Associates, shared that most major real estate companies operate their own in-house escrow departments. He emphasized that for many, this is an essential part of their business model.

In California, escrow companies handle closed sales, taking on responsibilities that lawyers typically oversee, such as title transfers. Escrow officers serve as impartial third parties in deals, facilitating smooth transactions. Escrow companies generally earn a small percentage, around $2 for every $2,000 in the sale.

This groundbreaking collaboration between Westside Estate Agency and Carolwood Estates, backed by the expertise of Gail Hershowitz, promises to reshape the luxury real estate market in Beverly Hills. As the fledgling venture, Private Escrow, gains traction, it stands as a testament to the power of cooperation and innovation in the competitive world of high-end real estate transactions.

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