John Daugherty Realtors has filed for bankruptcy protection. This follows a dispute with its landlord over the rent for its corporate offices at 520 Post Oak Boulevard.
Historically the company has handled many of the priciest single-family home sales in Houston. However it suffered a blow in early December when two of its top agents, Laura Sweeney and Lisa Kornhauser, left for Compass, a rival real estate brokerage. Sweeney was ranked number 1 on the Houston Business Journal’s 2019 list of Top Residential Real Estate Agents by Sales volume. Kornhauser was ranked number 4. The pair generated almost 20% of the sales volume at John Daugherty Realtors.
A week after their departure, the company announced it would be acquired by New York firm, Douglas Elliman, which has its Houston offices on Kirby Drive in the River Oaks area. The potential merger appears to have triggered the dispute.
The landlord at 520 Post Oak Boulevard, Griffin Partners, alleges that John Daugherty Realtors has breached its contract as it wants to get out of its lease (which runs to 2027) so that it can move into the offices on Kirby Drive.
The deal for Douglas Elliman to acquire John Daugherty Realtors has now collapsed. However Mr Daugherty himself and the remaining team are still expected to join the New York firm.
John Daugherty Realtors has denied the allegations made by Griffin Partners.
The company filed for Chapter 11 bankruptcy on February 27. Since then it has filed motions to pay its real estate agents outstanding commissions and to terminate its leases at both Post Oak Boulevard and its office in The Woodlands.