(c) 2013, Bloomberg News.
(c) 2013, Bloomberg News.
NEW YORK — Re/Max Holdings Inc., a franchiser of real estate brokerages, raised $220 million in its initial public offering, pricing the shares above the marketed range.
The Denver-based company sold 10 million shares for $22 each, according to data compiled by Bloomberg, after offering them for $19 to $21. The stock starts trading Wednesday, listed on the New York Stock Exchange under the symbol RMAX.
Re/Max is among property companies raising funds as the U.S. housing market rebounds. Home prices and sales are rising following the worst crash since the Great Depression. Shares of Realogy Holdings Corp., owner of the Century 21 and Coldwell Banker brokerage brands, and property-listings sites Zillow Inc. and Trulia Inc. have surged since their IPOs.
"Wall Street is looking for ways to monetize the housing recovery for their investors," Susan Wachter, a professor of real estate and finance and co-director of the Institute for Urban Research at the Wharton School at the University of Pennsylvania, said in a telephone interview before Re/Max's pricing. "This is perhaps the moment on the apex where the recovery is at its fastest, so it's a great time to go public."
RIHI, a corporation majority-owned by Re/Max founders David Liniger and Gail Liniger, will own 61 percent of Re/Max shares, according to a Sept. 30 regulatory filing. Weston Presidio, a private-equity firm that previously backed Re/Max, planned to sell its stake in the IPO, according to the filing.
Re/Max intends to use some of the money from the IPO to reacquire regional real estate franchises in the Southwest and Mid-Atlantic region of the U.S., the prospectus shows. Re/Max had net income of $33.3 million last year, compared with income of $24.2 million in 2011 and a loss of $2.75 million in 2010.
Sales of previously owned U.S. homes rose 1.7 percent in August to the highest level in more than six years, the National Association of Realtors said on Sept. 19. Home prices in 20 U.S. cities rose 12.4 percent in the 12 months through July, the most in more than seven years, the S&P/Case-Shiller index showed on Sept. 24.
Investors are benefiting from the recovery. Shares of Zillow, operator of the largest real estate information website, more than quadrupled through yesterday since the company's 2011 IPO. Trulia Inc., the San-Francisco-based residential-property listings website, almost tripled since it went public in September 2012. HD Supply Holdings Inc., a construction-supply company, has risen 23 percent since its June debut.