An explosive era for Denver’s Multiple Listing Service (MLS) has come to an end, but an even more controversial era could be upon us.
REcolorado announced Friday that it is being sold to the entity owned by Joseph Burks MAZL has been completed, three months after the two broker associations that previously owned the MLS fired the board of directors over an alleged breach of a confidentiality agreement.
“We want to ensure that REcolorado not only remains the foundation of Colorado’s real estate community, but also continues to set the standard for excellence and innovation as a subscriber-focused MLS,” Burks said in a statement.
The Denver Metro Association of Realtors (DMAR) and South Metro Denver Realtors Association (SMDRA) were the majority shareholders before the sale to Burks and MAZL. They started shopping in REcolorado earlier this year.
One of the interested parties they negotiated with was the existing board of directors, which in February thought it had a handshake deal to take over the MLS. But DMAR and SMDRA abruptly announced in June that it was selling to Burks, which came as a shock to the board.
After news of the sale leaked to the real estate blog Seller Alley, DMAR and SMDRA fired REcolorado’s board and leadership, claiming that the leak came from the board and constituted a breach of a confidentiality agreement.
Sources close to the situation said this HousingWire in June, years of growing tension between the parties prompted DMAR and SMDRA’s decision to sell to Burks instead of the board. The board warned agents in the Denver area that private ownership of REcolorado could have negative consequences, especially regarding data, including that compromised.
While the chapter of this bickering is over, Burks’ MAZL is already harassing Denver-area agents with its new participation agreement. Real estate advisor Rob Hahn stated in a post on his Substack that the participation agreement would be in conflict with National Association of Real Estate Agents rules if REcolorado was still owned by DMAR and SMDRA.
The new agreement, which agents must sign until October 9, transfers ownership of listing data from the broker to REcolorado itself. Furthermore, the agreement states that agents will be required to submit a written request to license their data, which the MLS may deny for any reason.
Listing data is the most valuable asset that MLSs have and REcolorados must have been of interest to MAZL when they decided to purchase the MLS, but NAR’s MLS Handbook says that an MLS should not restrict an agent’s access to its own data refuse or restrict. .
“[The agreement] not [data] property of the broker,” Hahn wrote. “I don’t know what that is, but it’s not property. And then REcolorado has the audacity to tell a broker that he can audit the broker’s use of the broker’s own data? This is not an MLS. This is a boss. Your lord and master.”
It’s unclear how the new participation agreement could affect the data-sharing agreement REcolorado signed with four other MLSs in January. REcolorado did not respond to requests for comment on the participation agreement in time for publication.
While the terms of the new participation agreement have yet to fully circulate among the Denver agent community, many agents in June expressed concerns about the sale to MAZL and Burks, concerns that were also fueled by dramatic changes in the way MLSs operate in relationship to new companies. rules regarding NAR’s $418 million antitrust settlement.
The changes to the participation agreement may exacerbate these concerns.
“The problem is much deeper than this,” Denver agent Dave Ness said in an email to HousingWire. “The problem is that even if we wanted to change MLS, we can’t. ReColorado is the only MLS that exists in the Greater Denver area. Pretty sure this would equate to a monopoly in court. That’s the real problem.”
