RE/MAX Escarpment Realty Inc.

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Lenka Vavrek

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The word 'GREAT' has been used throughout history to describe extraordinary events which not only had extreme consequences at the time but had tremendous physical and symbolic impact in their wake. What's uncanny is the fact that most of these so called 'GREAT' events were not always born of greatness the way we know it. When we think great, the 'GOAT' comes to mind (greatest of all time), or 'Great minds think alike', or 'Great job', or the 'Great White North'. All things rich with enthusiasm, except if you are a sitting Republican president, the last one may not count.Events of the past which were associated with this adjective were usually associated with large scale human hardship, like; The Great Fire of Chicago (1871), The Great Famine (1845), The Great Plague (1665), The Great Depression (1929), and The Great Recession (2008).The Great Reset is something which has been referred to by conspiracy theorists post pandemic, it is not an actual historical event, but it comes at a time when I believe we are being faced with the most incredible technological advancement in the last 500 years....Artificial Intelligence.Okay, five hundred years sounds a tad bombastic, but for sure this technology will definitely shape the 21st century. If we examine what has been spent in Q2 of 2025 on all things Al ($400 Billion), it overshadowed consumer consumption in the US, (consumer spending makes up over 60% of US GDP). Not to mention that growth in Al stocks in Canada and the US make up an oversized proportion of stock market activity.If It Looks Like a Bubble It Must Be a Life Changing TechnologyThroughout economic history we have experienced these technologies which without question changed the world, but also burst like a bubble. Remember the dot-com bubble as the internet became the dominant technology of the day. Not only did direct to consumer companies like Pets.com ($11 IPO to $0.22 two years later) collapse in the bubble, but so did internet infrastructure companies like Nortel, at one point it was Canada's largest company, and well positioned to supply the world with telecommunications equipment.Then the bubble began to expand with an oversupply of broadband infrastructure throughout North America and Nortel's stock peaked at C$124.00 after a massive stock split in-between, and later plummeted to 47 cents.Is Al All That And A Bag of ChipsThere are a few theories to the origin of the expression 'All that and a bag of chips, for this article I'm going with a food vendor who exclaimed "all that" was a basic meal and the addition of a bag of chips brought the meal to a new level of value. Like the icing on the cake, it is an intensifier. Al to this humble blogger's opinion is like the bag of chips for everything we do. It is next and a differentiator when we add it to what we are already doing. It is something that should 'UP' our businesses, it will help with developing and refining a piece of content, it will help us streamline our operations model, it will help identify gaps in our service model and give us ideas to improve it. It can identify bottlenecks and friction points in or general operations and help design a new model, and create resources to smooth the edges. Al represents your 'power partner' to power our businesses through this new reset era.2025 The Year That Was Supposed To BeThis was supposed to be that golden year (even though 25 is the silver anniversary year) for so many industries, real estate included. Two things lined up, it has been 5 years since the pandemic, and the fact that the century has come of age. The movie theatre business is the poster child for 2025 being the turn around year. Summer to the movie business is like Christmas is to the retail business and Halloween is to the candy business. The summer block buster was the one to heal all woes of a lack luster year. It's like their Black Friday. Aside from pandemic years July and August represent $2 billion plus in sales, which have been that way since 2015. It has been reported that the cinema business is off by 20 to 25% pre-pandemic, sound familiar?Content Is No Longer KingThe traditional movie business has proven you can't win with content alone. Let's face it theaters are fundamentally the same as they have been since as long as I can remember. Decades old facilities, sticky floors, unoriginal concessions and ridiculously high prices for a bottle of water. In 2025 the thought-to-be blockbusters like Snow White, Mission: Impossible - The Final Reckoning (let's hope its the final sequel), Superman and Jurassic World Rebirth turned out to be busts. Tried and true franchises like the Fantastic Four and Ballerina the John Wick spin-off, reek of unoriginality and failed to re-attract their core audience.It's time this business redefines the movie-goer experience, not only should they re-design the theaters with 4D motion seats, pod seating, couches, blankets etc. Provide virtual or augmented reality previews tied to upcoming films, insert Easter eggs in the cinema experience films only, gamify the theatre experience to encourage people to go multiple times and to multiple movies, with surprise gifts for those loyal viewers. Full digital experience with interactive apps where you choose your seat, and you have a food locker with your snack order in it for the minute you arrive. More gourmet and healthy options for food and beverage. The decor should be themed toward the movie, with instagrammable back drops. Encourage movie-goers to share their ideas for future sequels and pay royalties to those who provided the best ideas.The Emergence Of The Hybrid Business ModelThe quarter-century milestone brings about sober reflection as the century moves from young adult to full fledged responsible adult. As we now enter the "coming of age" era of this century it brings about feelings of nostalgia and reflection of trends and events of the past, but in order to move forward we must all possess a clear unencumbered vision of the future. In other words, many industries basked in the euphoria of the pre/during pandemic lift, which was artificial non-the-less, but left collateral damage in its wake. As businesses owners and home buyers/sellers mourn the lower costs and benefits of doing business in 2019, and the exponential growth which quickly followed, now must put forth a different strategy for the future.First-time buyers must make a more defined plan to build a down payment, buy amalgamating accelerated savings through well invested TSA's, using RRSP's which are funded by parents or grandparents, and good old fashioned discipline. Move-up buyers may also have to take a hybrid approach to moving up as equity in some housing categories may not be as accelerated as others.All industries including real estate practitioners must be thinking in a hybrid fashion going forward. We can learn a lot from Toyota's hybrid, multi-pathway approach to building cars. They have decided to put their efforts in various fuel cell technologies not just one. We in the real estate industry should adopt a multi-channel approach to our real estate business along with a new and improved customer experience. We should be producing quality general and segmented content (as one size does not fit all), and expand within the real estate vertical to areas like multi-generational housing options to co-purchasing with non-family etc.What Happens When The Watering Hole Gets Smaller.... ConsolidationCompanies like Porsche, are realizing a future with less sales, the management at Porsche is imagining a world where selling 20% less vehicles could be the norm. There is no more evidence of this than in the Canadian and US real estate markets. Sales in the last few years have been declining and remain much lower than the 10 year average. Real estate companies have been wrestling with this 'new normal' post pandemic and post cheap money. In the past when this occurred consolidation/acquisition was the key to moving on. Increase your top line and all your financial woes would disappear. But when you add Al to the mix it creates a goal within a goal.What I mean by that is as you expand your reach to create an invaluable data lake to draw more water/data.It has been reported that Compass purchase of the franchisor Anywhere (Better Homes and Gardens, Century 21, Coldwell Banker, Corcoran, ERA, and Sotheby's International) was an all-stock transaction valued at $1.6 billion dollars, with Compass assuming Anywhere's estimated debt of between $2.6 billion to $3.16 billion. At the lower debt level that's a monthly payment of interest only (5%) of over $10 million dollars to service the debt alone without accounting for operations. This may seem an illogical acquisition on the surface, but is there a deeper strategy at play. The messaging around this acquisition has been touted as a way to strengthen Compass' balance sheet, increase their footprint and bring about greater revenue diversity.The Final Word About The Great Reset Goes To The Master Plan of One CEO.But is there something else at play? There was no question that Compass was ready to acquire something off the heals of their failed purchase of Berkshire Hathaway's real estate business Home Services of America back in March of 2025. Not only does this fill some gaps for Robert Reffin the CEO of Compass but also allows him to put a nail in the proverbial clear cooperation coffin. Clear cooperation is a real estate policy from the Canadian Real Estate Association (CREA) and the National Association of Realtors (NAR) in the United States that limits exclusive listings to 24-72 hours, and then must be listed on the Multiple Listing Service. Reffkin's public feud with NAR and local boards was not a quiet one, also his strategy to hold back listings from the MLS was a direct hit to real estate portals like Zillow and Realtor. com. With the new company now having 340,000 agents, their ability to bypass Real Estate Boards and show case exclusive listings may become a reality, but flies in the face of greater exposure to the approximately 1,113,690 other realtors in the US and in turn 'RESET' the way real estate consumers in the US shop for properties.

ARE WE AT THE DAWN OF "THE GREAT RESET" ?

Lenka Vavrek

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