New York City-based real estate tech company Compass Inc. is laying off 84 workers in Seattle, according to a Worker Adjustment and Retraining Notification filed with the state of Washington.
The notification said the layoffs will start Nov. 19, and they will include 84 local workers and 187 virtual workers. A Tuesday filing with the Securities and Exchange Commission said the company was reducing its workforce as part of a cost-cutting effort, and because Compass' technology is already well-established, "a significant portion" of the cuts involve the product and engineering teams.
A Compass spokesperson said the 187 virtual workers facing layoffs are actually spread across the country and are only technically designated as Washington state employees. The spokesperson didn't say whether the company was closing its offices here or provide an updated headcount in Seattle. The spokesperson did, however, confirm the accuracy of the WARN and the SEC filings.
In an SEC filing from June, Compass announced it was laying off about 10% of its headcount, or roughly 450 people companywide, and said it was shutting down Modus Technologies, a Seattle-based title and escrow company Compass acquired in 2020. The Tuesday SEC filing noted the new layoffs are separate from those disclosed in the June filing. Between the two disclosed cuts, Compass expects to pay out between $23 million and $26 million in severance and other termination benefits to employees laid off this quarter.
Compass, founded in 2012, allows users to browse homes to rent or buy. The company also provides services to real estate agents. Compass' concierge service helps sellers with services like staging and painting. According to a February filing with the SEC, Compass had 4,775 total employees at the end of last year.
Multiple local companies in the real estate industry have made cuts this year as mortgage rates have started to climb. Seattle-based Redfin announced in June it was laying off about 470 employees, while Seattle-based Flyhomes in July confirmed it was laying off about 20% of its staff.
In the company's second quarter earnings results, released in August, Compass reported revenue of $2 billion, a 4% year-over-year increase. Nevertheless, co-founder and CEO Robert Reffkin said in a release that challenges in the real estate market were making Compass cut costs.
"We have line of sight into each area that will drive these savings to our expenses, which we believe will enable us to be free-cash-flow positive in 2023. We expect to complete all targeted cost reductions by the end of this calendar year," Reffkin said in the release.
