PIUS CEO tells Inman the company is functioning ‘on a smaller sized scale,’ but a previous REX agent suggests these functions no more time include things like managing serious estate transactions.
An insurance coverage agency for REX Actual Estate suggests that in spite of experiences that the company is shutting down, REX is however operating and the company “remains assured in REX’s technological innovation.”
In March, PIUS declared it had secured $10 million in funding for REX, bringing REX’s total funding to $141 million, in accordance to PitchBook details. PIUS is an insurance coverage agency that insures loans from institutional traders to superior-growth tech organizations based mostly on the tech firm’s intellectual home and other assets, in accordance to the company. The $10 million is a non-public placement bond underwritten by PIUS, the agency added.
In email messages to Inman, PIUS declined to say who experienced loaned REX the money, but stressed that PIUS is neither a loan company nor an trader.
“Rather, PIUS provides rising technological know-how organizations with non-dilutive financial debt by employing their mental assets as collateral,” Joe Agiato, PIUS’s CEO, explained to Inman by using email.
“PIUS performs an in-depth assessment of a company’s technologies and IP portfolio, and based mostly on this, PIUS insures the price of the financial loan to offer greater amounts of capital at decreased premiums.”
Agiato reported REX “is continue to running, albeit on a scaled-down scale. PIUS stays assured in REX’s engineering, which is the basis of our economic romance.”
Agiato declined to comment further and would not say whether or not the $10 million transaction experienced closed or no matter whether REX experienced decided on to training the deal’s accordion aspect, which would have permitted REX to raise its line of credit rating with its loan company to $45 million.
At the time PIUS introduced the funding, the organization praised REX as “the nationwide leader in true estate reform, with the objective of eradicating service fees, increasing the U.S. true estate market place, and saving Us citizens billions of dollars” yearly.
“REX Residences has constructed out an unbelievable suite of tech solutions and companies, with its shopper-initial design poised to disrupt the actual estate market, using AI to learn rapidly how to greatest provide its buyers,” Agiato claimed in a assertion in March.
“Through its tech instruments and a totally-integrated system, REX is bringing a wholly new actual estate experience to today’s shoppers, and PIUS is enthusiastic to support REX in furthering that mission.”
At the exact same time, REX CEO Jack Ryan said that the funding would “support REX’s ongoing business development and market expansion, including equally our technology system and residence consumer companies, as we uphold our mission to produce a immediate-to-customer actual estate alternative for individuals throughout the country.”
That solution no lengthier appears to incorporate the brokerage. REX reportedly lower loose all of its agents a week back. A former REX agent in Southern California — who questioned not to be named to prevent professional repercussions — instructed Inman that REX, right after permitting go staffers in other departments earlier in the 7 days, had allow all of its brokers go by means of a companywide inside messaging program on Thursday.
“We were being knowledgeable as a group … that REX was no for a longer time likely to be undertaking true estate transactions,” he mentioned.
“We didn’t see it coming,” he added, of the brokerage’s downfall. “It all fell apart in just one week.”
He had two pending listing contracts, and though brokers ended up advised they could take their contracts with them, he finished up canceling them because he didn’t know where he would conclusion up. He thinks he’ll be able to get them again now that he landed at eXp Realty about the weekend.
He reported he experienced worked at REX for about two many years, experienced relished his time there, and the corporation experienced addressed him well. He also felt the company’s business design, which presents reduced listing service fees to sellers and rebates to purchasers, was a superior match for him.
“I like the strategy,” he stated. “I believed they were being a lot more apprehensive about supplying the shopper more command over the transaction and placing them initially over the fee.”
He also liked that he could offer you customers and sellers “one-stop shopping” mainly because REX experienced in-property ancillary companies these kinds of as mortgages and moving companies.
“Being able to aid them from A to Z is what created REX distinct,” he reported.
He explained that he from time to time acquired pushback from a handful of brokers about REX’s business design, complaining that he was not charging enough. But he experienced no challenges with most brokers, he reported, specifically all those “worried about assisting the buyer.”
As a result much, the only endeavor REX has said undoubtedly it would proceed is its lawsuit versus the Countrywide Affiliation of Realtors and Zillow. Previous week, REX employed famed lawyer David Boies to signify the enterprise in courtroom.
REX Common Counsel Michael Toth did not respond to requests for comment.
E-mail Andrea V. Brambila.