Berkshire Hathaway Inc, the multi-national conglomerate owned by investor Warren Buffet is reportedly acquiring Intero Real Estate Services, the Cupertino-based residential real estate powerhouse.
Although no official word has been released on the deal, several tabloids are reporting that HomeServices of America (HSF), the real estate affiliate of Berkshire Hathaway is negotiating a purchase deal with the property firm.
News of the potential agreement comes just a month after HSF announced that the firm's real estate network has grown to "26,000 agents and 700 offices in 33 states with the affiliation of 22 more brokerages," according to Inman News.
"We're pleased with the rapid growth of Berkshire Hathaway HomeServices and our momentum continues to build. Affiliates understand the strength and long-term potential of a real estate brand whose namesake is Berkshire Hathaway Inc., the world's most respected corporation according to Barron's," Earl Lee, CEO of HSF Affiliates LLC, said in a statement.
This particular deal with Intero would give Berkshire Hathaway a strong foothold in the Silicon Valley residential real estate market. Intero, founded in 2002, has been a star property firm expanding rapidly since its debut. In 2013, the company posted sales volume of $8.7 billion, according to the Business Journal. Intero is the 12th largest residential brokerage firm in the country and the third best in the Silicon Valley.
The deal could also mark Berkshire Hathaway's growing interest in real estate. The conglomerate recently announced that it will rebrand its Prudential and Real Living Services title to Berkshire Hathaway HomeServices.
But Warren Buffet has long been a fan of real estate and put his faith in property. In his annual letter to shareholders, Buffet revealed that two small real estate investments he made years ago taught him the tricks of the property business.
"My two purchases were made in 1986 and 1993. What the economy, interest rates, or the stock market might do in the years immediately following - 1987 and 1994 - was of no importance to me in determining the success of those investments. ... A 'flash crash' or some other extreme market fluctuation can't hurt an investor. Indeed, tumbling markets can be helpful to the true investor if he has cash available when prices get far out of line with values. A climate of fear is your friend when investing; a euphoric world is your enemy," Buffet explained.