The identical day Seattle-based actual property corporations Zillow and Redfin introduced a $100 million partnership, Redfin disclosed it could lay off 450 staff within the course of.
Zillow mentioned in an earnings name Tuesday that it could change into the only supplier of multifamily rental listings on Redfin and its subsidiaries, ApartmentGuide.com and Lease.com. Leases are a rising enterprise for Zillow, which reported 25% annual income progress for its leases section within the remaining three months of 2024.
A subsequent regulatory submitting from Redfin on Tuesday disclosed the phrases of the deal. Zillow can pay Redfin $100 million to change into the unique accomplice for multifamily rental listings.
Redfin mentioned within the submitting it must restructure its leases section for the partnership which is able to lead to $18 million to $21 million in bills for the corporate. Workers in its leases enterprise will likely be laid off between February and July.
Only a few of the layoffs will have an effect on Washington staff, a Redfin spokesperson mentioned in an emailed assertion Thursday. Affected staff will likely be eligible for severance and medical health insurance assist.
“A layoff of this magnitude is painful, however this partnership is finest for our prospects and for Redfin general,” the spokesperson mentioned. “Our focus stays on constructing the very best on-line house search, and pairing it with the very best brokerage, lending and title service.”
As of 2023, Redfin had 4,693 staff, in line with its most up-to-date annual report. The corporate will launch its subsequent annual report on the finish of February.
In November, throughout Redfin’s third-quarter earnings, the corporate reported a web lack of $33.8 million and CEO Glenn Kelman apologized to shareholders. The loss, a 78% improve in contrast with the identical quarter of 2023, was a results of the growth of the Redfin Subsequent pay plan for actual property brokers, Kelman mentioned.
That is the second spherical of layoffs at Redfin this yr. The primary was final month and it hit 46 staff, largely in management roles, GeekWire reported.
Redfin additionally laid off lots of of staff in 2022 and 2023 because the housing market cooled and the corporate stopped its home-flipping enterprise. The corporate introduced in June 2022 that it was shedding almost 500 staff, adopted up by 862 staff in November 2022. In April 2023, Redfin laid off a further 201 individuals.
