Shorewest most recently was approached this month by the Prudential Real Estate Network, atop previous overtures from Coldwell Banker, Century 21, ReMax and other national companies, the Hornungs said.
"They (Prudential) wanted to buy us out," said Donald Hornung, president of Shorewest. "We’ve talked to them all. It has never been an option. This company is now going into its third generation. This company is going to continue as an independent firm."
"We told them we would talk, but we told them they were wasting their time," said John Hornung, Shorewest’s chairman of the board.
Prudential’s offer came after Wisconsin Preferred Homes, Brookfield, announced in August it is joining a business alliance with Madison-based First Weber Group.
Wisconsin Preferred Homes, which previously had been affiliated with Prudential, is now marketing its services under the First Weber name in the Milwaukee area.
The switch has caused quite a stir in Milwaukee realty circles, but the Hornungs say it didn’t catch them by surprise.
Shorewest plans to maintain its 26% share of the southeastern Wisconsin market, the Hornungs said. Wisconsin Preferred Homes, under the Prudential flag, had 9% of the market.
"All they’ve done is change Prudential’s name to First Weber, and they still have the same market share," Donald Hornung said. "It’s a lot of hype."
Shorewest reported sales of $1.65 billion in 2001 and projects 2002 sales to exceed $1.7 billion.
Combined, First Weber and Wisconsin Preferred Homes reported 2001 sales of $1.5 billion, and they’re also projecting 2002 sales of $1.7 billion.
Shorewest plans to continue to focus on its presence in the southeastern Wisconsin market.
Which is not to say Shorewest will simply stand pat, the Hornungs said.
"We look at contiguous marketplaces," Donald Hornung said. "We’re always talking to smaller real estate firms (about acquisitions). We’re focusing on it more than in the past."
"It’ll cause us to be a little sharper," John Hornung said. "It forces you to focus on what you’re doing."
Shorewest recently hired 44 new agents, and the Hornungs say they plan to further expand their workforce.
"We’re always recruiting. The more agents you have, the more penetration you have in the marketplace," Donald Hornung said.
Shorewest, which spent $600,000 to market its brand name this year, plans to maintain the same level of marketing in 2003, although inflation could cause the same rate of exposure to be more costly, the Hornungs said.
Shorewest plans to continue its television, radio and billboard marketing campaign, featuring a young annoying yodeler who prompts neighbors to put their homes up for sale. The yodeler concept was created by the Meyer & Wallis marketing firm in Milwaukee when Shorewest changed its name from Wauwatosa Realty in the mid-1990s.
"He (the yodeler) will be a part of it," Donald Hornung said. "It has drawn attention to our company."
Ironically, Shorewest also picked up some business when Prudential was left homeless in the Milwaukee market. Prudential Relocation, headquartered in Scottsdale, Ariz., selected Shorewest as the primary broker for its relocation business in metropolitan Milwaukee.
Of course, that business will be limited for the time being, since Prudential has lost its market share in Milwaukee.
A Prudential spokesman did not return calls for comment.
In a business of growing consolidation, Shorewest is the 19th-largest independent real estate company in the nation.
Though being a David in a business dominated by Goliaths has its disadvantages in advertising and networking muscle, it also has its perks, such as being more personal, accountable and flexible, the Hornungs said.
"We are not publicly held. We can run and staff an office without a profit for a couple of years to get it going," Donald Hornung said. "That’s not going to happen with a publicly held company; absolutely not. We’re running this as a business. They’re running it as a profit center."
John’s sons, John P. Hornung and Joseph Hornung, are vice presidents at Shorewest and are being groomed to take the helm.
"We’re not building it to sell it," said John Hornung, whose father, John A. Hornung, founded the company in 1946. "We’re building it for the next generation."
Sept. 27, 2002 Small Business Times, Milwaukee
