Dottie Herman, CEO of Douglas Elliman, has sold her 29.4 percent stake in the New York City-based brokerage for $40 million to its parent company.
The announcement was made by the Vector Group, among the country’s largest tobacco manufacturers, which had already controlled 71 percent of the firm. Herman sold her shares for $10 million up front and $30 million to be paid in 12 quarterly payments according to an SEC filing.
Founded in New York City in 1911, Douglas Elliman is the largest brokerage in the New York metropolitan area and the third-largest residential real estate company nationwide. It was ranked third among real estate brokerages nationwide for transaction volume as recently as 2017, according to the Real Trends 500 .
Steve Murray, president and owner of Real Trends, said that Elliman is probably worth $250 million to $300 million. Real Trends represented Herman in the sale. He believes both sides walked away with a good deal, given the dynamics.
“She wanted to sell, but he was under absolutely no compunction to have to buy. The leverage was always with Howard because he’s the majority owner.”
Howard Lorber, the president and CEO of Vector Group and chairman of Douglas Elliman, acquired the company in December 2013 with Herman.
“Dottie and I couldn’t have imagined that the venture we embarked on years ago would grow into the largest residential brokerage firm in the New York metropolitan area," Lorber said in a press release. "Her vision for and dedication to Douglas Elliman have proven invaluable and have helped cement Douglas Elliman as one of the country’s premiere brokerages. We are excited about the next phase of Douglas Elliman’s growth, and are confident the company is well positioned for the future.”
News reports say that Herman will continue in her role as chief executive officer of Douglas Elliman.