Smart moves kept Hanna growing as housing stumbled
Howard Hanna Real Estate signs are ubiquitous across the Pittsburgh region — and for good reason.
Hanna has grown to become the fourth-largest real estate company in the nation and the dominant player in the local market through a series of targeted acquisitions that boosted its business despite the now-easing recession in the housing market.
“Expansion has been one of the keys to our growth,” said Howard “Hoddy” Hanna III, CEO of the Pittsburgh-based family business.
Hanna has outdistanced its competitors with a 29.9 percent share of the regional market last year, according to West Penn Multi-List, the major multiple-listing agency that covers 13 Western Pennsylvania counties.
Coldwell Banker Real Estate had 18.9 percent, Prudential Preferred Realty had 11.9 percent and Northwood Realty Services, 10.9 percent,
Although the recession was devastating for the real estate industry, it was good news for Hanna. The company managed to capitalize on the misfortunes of some struggling real estate companies and snapped them up for a bargain.
“The recession helped Hanna obtain some companies which had ... trouble surviving the downturn in the housing market,” said Steve Murray, president of Real Trends magazine, which follows the nation's real estate industry.
Hanna has grown from a single office founded in Oakland in 1957 by Howard Hanna's father to a company with 144 offices and more than 3,000 real estate agents in five states — Pennsylvania, Ohio, West Virginia, New York and Michigan.
The expansion included 45 acquisitions, which helped boost the company's real estate deals to a record last year. The company closed 41,348 transactions valued at $7.1 billion, the largest in its 56-year history, up from 34,292 valued at $5.76 billion the previous year. But expansion isn't the only key to its success.
Hanna has snagged the coveted designation as Christie's Great Estate representative in Pennsylvania, meaning that it can offer trophy homes and estates (priced above $750,000) from the renowned auction house. The affiliation is a boost to its brand and bottom line.
Hanna has created value for its business by being a pioneer in marketing its listings on television — a concept that has been copied by others.
Hanna promotes itself as a one-stop shop for house sales, offering complete mortgage, title and insurance services to clients, along with a 100 percent money-back guarantee to a buyer who is not satisfied with a Hanna-listed house. It provides closing funds for a client who wants to buy a house before his or her Hanna-listed house sells.
“Hanna is a well-run family business, which has made wise acquisitions over the past three to four years during the period the housing market hit bottom,” said Stuart Hoffman, chief economist, PNC Financial Services.
The expansion isn't over yet. The company is looking at East Coast starts, looking westward from Michigan and considering Baltimore and Indianapolis.
Its expansion began in 1985 when the Hanna company purchased the former Spiro real estate company in Pittsburgh. That taught it how to integrate a large real estate company into its operation, compared to some smaller ones it had purchased, Hoddy Hanna said.
It made its first out-of-state acquisition in 1996 with the purchase of Del Realty in the Youngstown, Ohio, area.
The recession did not derail the company from expanding: It purchased several offices in Harrisburg that were having financial problems, he said. And while local sales dipped slightly, the stable market here enabled the company to continue as a major leader in the industry.
However, it made a misstep in opening several offices in Florida in the early 1990s, he said. “We found that was too far a distance for us to operate efficiently, so we closed them.”
There are 13 members of the Hanna family, including relatives, who are part of the organization.
Hoddy's son, Howard W. (Hoby) Hanna IV, is president of the Ohio and Michigan divisions.
“The Hanna organization is truly a family enterprise, but each member must continually prove they can do the job to keep their job,” Murray said.
Sam Spatter is a staff writer for Trib Total Media. He can be reached at 412-320-7843 or email@example.com.