Coldwell Banker Franchise

Financing Details

Coldwell Banker Commercial Real Estate LLC, or a related party, may offer financing to franchisees for conversion costs or growth opportunities, though it is not obligated to do so. These financing options are available as promissory notes, including a Conversion Promissory Note and an Expansion Promissory Note. These notes typically bear 0% interest, with an 18% interest rate applied only upon payment default. The Conversion Promissory Note has a term of 9-10 years and offers an opportunity for annual principal forgiveness if the franchisee meets specific annual Gross Revenue thresholds and remains in compliance with the franchise agreement. The Expansion Promissory Note is for existing franchisees, has a variable term, and requires a lump sum payment at maturity without any forgiveness opportunities. All financing requires a personal guaranty from the franchisee's owners and their spouses, as well as a security agreement on the business assets.

Litigation Summary

Coldwell Banker Commercial Real Estate LLC, along with its parent company Anywhere Real Estate Inc. and other affiliates, has been involved in significant litigation, including a case where a former franchisee was ordered to pay over $7.5 million for trademark infringement and breach of contract; appeals for this case are ongoing. The company is also a defendant in several class action lawsuits (Moehrl, Burnett, Nosalek, Batton, Homie, McFall) that challenge residential real estate commission rules and allege anti-competitive practices. Coldwell Banker Commercial's parent company, Anywhere Real Estate Inc., entered a nationwide settlement of $83.5 million for the Moehrl and Burnett cases in October 2023, which received final court approval in May 2024, but this approval is currently under appeal by several parties. Many similar 'copycat' lawsuits have been filed against Anywhere entities and are generally dismissed or stayed pending the appeals. Additionally, the company's affiliates are involved in an ongoing class action (Chinitz) alleging violations of the Telephone Consumer Protection Act for unsolicited calls, which reached a $20 million settlement in January 2025, awaiting court approval. The Washington Office of the Attorney General also launched an investigation into real estate brokerage practices, issuing a Civil Investigative Demand in February 2024. Prior resolved cases include a trademark infringement settlement for $50,000 in 2018 and a class action settlement for $200,000 regarding unsolicited calls in 2020. A regulatory investigation by HUD and the FTC concerning hazard reports concluded with a settlement in 2009.

Renewal Conditions

Coldwell Banker Commercial Real Estate LLC does not grant renewal rights for its primary franchise agreement. If the franchisor decides to grant an additional term, franchisees may be required to sign the then-current franchise agreement or a Term Extension Addendum, which could have materially different terms. For a Limited Purpose Office (such as a Property Management Office), the agreement automatically extends for additional one-year periods unless terminated.

Staffing Notes

Coldwell Banker Commercial Real Estate LLC franchisees are expected to operate an office with staffing for up to 30 people, which includes both employees and independent sales associates. A licensed Responsible Broker must be retained, and the owner, commercial manager, and the Responsible Broker are required to attend an initial Orientation program. All management personnel, brokers, and independent sales associates must adhere to confidentiality regarding the system's information. The franchisor emphasizes that it does not act as an employer for the franchisee's staff or agents, placing full responsibility for hiring, compensation, and daily management decisions on the franchisee.