The Real Estate Authority's complaints assessment committee found the decision was enough of a penalty against CBRE. Photo / 123rf
The Real Estate Authority's complaints assessment committee found the decision was enough of a penalty against CBRE. Photo / 123rf
Major Auckland-headquartered corporate real estate agency CBRE has been found to have breached a rule in the Real Estate Agents Act.
But it didn’t suffer any penalty like a fine or order against it because the decision was said to be enough punishment.
The Real Estate Authority released a decisionin the case where CBRE was found to have engaged in unsatisfactory conduct by proceeding with a real estate transaction without a signed agency agreement.
CBRE breached rule 9.6 of the Real Estate Agents Act (Professional Conduct and Client Care) Rules, the authority decided.
Last June, the authority got an audit report for CBRE which identified a commission payment. But no signed agency agreement could be found for that transaction.
So last August, an authority investigator looked into matters and found the business had completed the transaction for a property which was not identified, but didn’t have an agency agreement in place.
Last November, a complaints assessment committee chaired by Maria McElwee heard the case, sitting with Amanda Elliott and Susanne Guhl.
Matters dated back to 2020 when CBRE got a general agency agreement on a property which was being leased.
“The client’s property manager subsequently contacted the licensee to advise that the agency and the client were in the process of agreeing on terms for a blanket agency agreement and, for this reason, an agency agreement for the transaction was not required,” the decision said.
People involved thought “mistakenly” that appointment of the agency for the deal was being executed at a higher level, so things went ahead without documents being signed by both parties.
A tenant was found for the property and a lease agreement was drawn up.
It was only in 2021 that people realised there was no signed agency agreement. The licensee had five and a half years of experience, the authority noted.
To avoid something like this happening again, CBRE has in place annual compulsory training on agency agreements and business operations for existing as well as new employees. New employees have a structured introductory training programme. Refresher training is also provided for all employees, with a focus on agency agreements and processes.
The agency accepted that it was in breach of a rule. The committee, therefore, decided that the breach did not warrant a disciplinary response.
The committee concluded that the unsatisfactory conduct finding against CBRE was a sufficient penalty and decided to make no orders.
Asked by the Herald to comment on the case, the agency said: “This was the result of a miscommunication between CBRE and a client, which led us to believe that an agency agreement was already in place.
Andrew Stringer at CBRE's new HQ in the ANZ Centre. Photo / Brett Phibbs
“The authority noted in its findings that CBRE responded promptly, appropriately and transparently and they were satisfied that the breach was unintentional. The authority also noted that CBRE had no prior disciplinary history and that no complaint had been made by the client. We’re pleased that the authority has seen fit to take no further action and we have put processes in place to ensure that this situation does not reoccur,” the agency said of the case.
The agency’s New Zealand headquarters are on level 37 of a tower in Auckland’s heart.
Last January, senior managing director Andrew Stringer showed off the space in the 39-level ANZ Centre, in Albert St.
Reception overlooks Albert St. Stringer pointed out then that many firms might have used their best northeast positions for client meetings or to show off to visitors. But it’s the staff he wants to impress and encourage to come into the office - as well as keep.
About 110 staff started in the new office last January, having left levels 14 and 15 of the tower.
The 1000sq m level 37 is one of many floors once leased to law firm Chapman Tripp, now a block away on level 34 of the new $1 billion PwC Tower at Commercial Bay.
