Real estate valuation technology company clear capital has carried out a new round of layoffs as part of a restructuring plan for the company. The firm announced Wednesday that it would cut about 24% of its workforce, or more than 250 jobs, as it reshuffles departments and consolidates teams amid a tough real-estate market.
According to the firm, this round of layoffs will include cuts in some management and leadership roles.
“We are consolidating different teams, so some leadership roles will be eliminated due to redundancy,” Clear Capital CEO Duane Andrews said in an interview with HousingWire. “Retiring departments makes sense when volumes are so low that you can’t keep as many management positions at the time. So, we did it in a way that really makes sense for our business.”
Employees were notified Wednesday morning about the staff reductions. Those who were affected by the layoffs will receive severance packages and relocation services to help with the transition, Clear Capital said.
This is the second round of layoffs carried out by Clear Capital in recent months. The firm cut its workforce by about 27%, or about 350 positions, in October following a slowdown in the housing market.
According to Andrews, the goal of the restructuring is to help the company navigate current industry hurdles and prepare for where will the market be longer term.
“This reduction in force is really a restructuring of our company rather than a company size adjustment, a fundamental restructuring of our company to meet the market where it is today and to be where it will be in the future. Andrews said.
Following this round of downsizing, Clear Capital’s total employee workforce will be around 800, according to the firm. The firm had around 1,400 employees at the end of 2021.
“We saw this not only as an adjustment to the current market climate, but also as the current change that is occurring in the valuation industry. We have been a company that has been investing heavily in bringing data analytics and technology to the valuation space. We have been very involved in modernizing the appraisal [and] investment over the last five years,” said Kenon Chen, executive vice president of corporate strategy at Clear Capital.
“We are using this as an opportunity to restructure our company in a way that we believe will allow these programs to be adopted and succeed in the future.”
Chen said the company has taken a holistic approach to the restructuring and that, in addition to the layoffs, the executive team will take a pay cut of at least 10%.
“We don’t take for granted the impact this has on people, the impact on their families and their careers. We don’t take any of those things lightly,” Chen said. “This decision was made with that in mind, but knowing that, it is the right thing to do, not only for the future health of the company, but also for the good of our customers and those we want to continue to serve. , [to] continue to help advance the industry.”
The firm said the goal is to deal with layoffs with “continued empathy.”
“We believe this will put us in a very comfortable position to continue to reinvest in our technology and solutions for the foreseeable future. Of course, we will always have to continue to navigate market changes as they occur, but we are confident that this structure will give us the operational focus we need to be very resilient, even if the market falls further,” Chen said. .
The firm, one of the largest appraisal management companies in the United States, cited similar reasons for the layoffs that occurred late last year. At the time, Andrews said the company was restructuring all divisions to reduce expenses and support future strategy, which would allow the company to refocus the business on key areas and ensure they were on track for sustainable growth.
In July 2022, Clear Capital unfolded two Application Programming Interfaces (APIs), a Property Valuation API and a Risk Assessment API, to facilitate the adoption and implementation of modern valuation solutions, leading to faster loan closings. Desktop assessment solutions were developed to meet new desktop assessment guidelines introduced in April 2022.
In January 2022, the firm launched ClearPhoto, a photo review system that automates collateral underwriting in accordance with government-sponsored business guidelines and internal credit policies. The tool uses computer vision technology to highlight the correct files automatically, allowing insurers to make more efficient and informed decisions, the company said.
The Reno, Nevada-based company was established in 2001 and claims that with its desktop assessment solutions, desktop appraisals can be completed up to 50% faster compared to traditional appraisals.
