Sotheby’s International Realty terminates franchise agreement with Sino Gateway
Statement says firm is ‘disappointed to learn of the legal matters involving [Gateway offshoot] Hong Kong Homes’
Sotheby’s International Realty, the New Jersey headquartered estate agency franchise, has terminated its agreement with Hong Kong partner Sino Gateway, after claiming the latter was involved in “legal matters” over its ability to sell properties overseas.
“Effective August 26, 2016, we terminated our franchise agreement with Sino Gateway that previously did business as Hong Kong Sotheby’s International Realty,” Sotheby’s said in a written email to the South China Morning Post on Tuesday.
Sotheby’s said it had terminated the agreement as it was “disappointed to learn of the legal matters involving Hong Kong Homes.” It did not elaborate.
Sino Gateway is owned by veteran property agent Samson Law, who also owns another agency called Hong Kong Homes, which specialises in selling overseas properties to Hong Kong buyers.
Hong Kong Homes was the marketing agent promoting a number of uncompleted properties in Manchester to Hong Kong buyers two years ago.
But some of the projects failed to be completed according to schedule, triggering angry buyers to report the case to the Hong Kong police.
In June, a group of 60 buyers protested outside Wan Chai police headquarters, calling for an investigation involving the unfinished presale properties Manchester and Bradford.
Hong Kong media reported that hundreds of local buyers bought units in 2014 to be built by British homebuilder Absolute Living Department. But the developer was wound up in February this year. Hong Kong Homes was the marketing agent for some of the projects.
Hong Kong Homes also marketed another project called Angelgate in Manchester, which was developed by PinnacleMCGlobal, slated to be completed in February 2016. Construction work was delayed after their building contractor went into administration.
Asked why the agreement was terminated, Law of Hong Kong Homes, said: “Let me think about how to answer you.”
Sotheby’s started the franchise agreement with Sino Gateway in 2010. Law told the Post in a 2010 interview that it was a 25-year franchise agreement.
Sotheby’s International Realty is a subsidiary of Realogy Holdings Corp, a New York-listed company in real estate franchising and provider of real estate brokerage, relocation and settlement services.
In February 2004, Realogy entered a long-term strategic alliance with Sotheby’s, the operator of the auction house. The agreement provided for the licensing of the Sotheby’s International Realty name and the development of a full franchise.
“As more Hong Kong people invest in overseas properties, there could be risks involved. The government should consider how to protect buyers and how to regulate the industry,” said Landscope Christie’s International Real Estate chief executive and founder Koh Keng-shing.
The sale and purchase of overseas properties are not subject to the regulation of the Estate Agents Ordinance.