If Counselor Realty consents to an Extension Office, is the franchisee required to operate it?
Counselor_Realty Franchise · 2025 FDDAnswer from 2025 FDD Document
- (c) If Counselor has consented to any Extension Office locations, you must maintain the mutually agreed-upon minimum number of sales agents operating from such Extension Office.
One of these sales agents must be a supervising broker.
The minimum number of sales agents required to be operating in any such Extension Office is separate from and in addition to the minimum number of sales agents that are required to operate from any of your other Office locations (including any Additional Offices).
If you fail to satisfy and maintain the minimum required number of sales agents in the Extension Office on an ongoing basis, Counselor may (in its sole discretion) elect to have you close the Extension Office or terminate the Franchise Agreement.
If Counselor elects to have you close the Extension Office, (i) you must (A) stop using the Marks and System, any materials containing or depicting the Marks or System, and any other name or mark confusingly similar to the Marks, including domain names, in connection with such Extension Office, (B) pay all sums due to Counselor or its affiliates with respect to such Extension Office, and (C) remove all distinctive inventory, trade dress, and leasehold improvements at such Extension Office to eliminate any similarity in design, structure, signage, trade dress, decor, color or layout to the distinctive appearance of other Counselor businesses, (ii) Counselor or its affiliate may access and remove any confidential or proprietary information and materials, either at the Extension Office or remotely by electronic means, and (iii) Counselor will no longer list such Extension Office (or any sales agents operating from such Extension Office) on its website.
If Counselor has consented to any Extension Office, you will not receive any territorial protections with respect to such Extension Office.
Both Counselor and other "Counselor" licensees may provide residential and commercial real estate brokerage services anywhere near such
Extension Office. In addition, Counselor may itself establish or operate a "Counselor" office, or license another to establish or operate a "Counselor" office, anywhere near such Extension Office; provided, however, that if Counselor proposes to license another to establish or operate a "Counselor Office" with a territory that would include the location where such Extension Office is located (a "Territory Opportunity"), we will provide you with a right of first refusal for such Territory Opportunity on the following terms:
Source: Item 22 — CONTRACTS (FDD page 32)
What This Means (2025 FDD)
According to Counselor Realty's 2025 Franchise Disclosure Document, if Counselor Realty consents to an Extension Office, the franchisee is required to operate it and maintain a mutually agreed-upon minimum number of sales agents. One of these agents must be a supervising broker. This minimum number is separate from the agent requirements of other office locations.
Failure to maintain the minimum number of sales agents in the Extension Office can lead to Counselor Realty electing to have the franchisee close the Extension Office or terminate the Franchise Agreement. If Counselor Realty chooses to close the Extension Office, the franchisee must cease using Counselor Realty's marks and system, pay all outstanding dues, and remove any distinctive elements that resemble other Counselor Realty businesses. Counselor Realty may also access and remove confidential information, and the Extension Office will be removed from Counselor Realty's website.
Furthermore, franchisees operating an Extension Office do not receive territorial protections. Counselor Realty and other licensees can offer real estate services nearby, and Counselor Realty can establish or license another office nearby. However, the franchisee will have the right of first refusal if Counselor Realty intends to license another office with a territory including the Extension Office's location.
This arrangement carries significant implications for a prospective Counselor Realty franchisee. While an Extension Office can expand market reach, it also introduces stricter operational requirements and potential financial risks. The lack of territorial protection means increased competition, and the consequences of failing to meet agent quotas can be severe, including closure of the Extension Office and potential termination of the franchise agreement. Therefore, a franchisee must carefully consider these factors before pursuing an Extension Office.