Restructuring Costs (Notes)

12 Months Ended

Dec. 31, 2019

Restructuring and Related Activities [Abstract]

RESTRUCTURING COSTS

Restructuring charges for the years ended December 31, 2019, 2018 and 2017 were $42 million, $47 million and $12 million, respectively. The components of the restructuring charges for the years ended December 31, 2019, 2018 and 2017 were as follows:


	Years Ended December 31,
	2019		2018		2017
Personnel-related costs (1)	$	24	$	17	$	7
Facility-related costs (2)	17		20		4
Internal use software impairment (3)	—		10		—
Other restructuring costs (4)	1		—		1
Total restructuring charges (5)	$	42	$	47	$	12

_______________

(1)Personnel-related costs consist of severance costs provided to employees who have been terminated and duplicate payroll costs during transition.

(2)Facility-related costs consist of costs associated with planned facility closures such as contract termination costs, amortization of lease assets that will continue to be incurred under the contract for its remaining term without economic benefit to the Company, accelerated depreciation on asset disposals and other facility and employee relocation related costs.

(3)Internal use software impairment relates to development costs capitalized for a project that was determined to not meet the Company's strategic goals when analyzed by the Company's new leadership team.

(4)Other restructuring costs consist of costs related to professional fees, consulting fees and other costs associated with restructuring activities which are primarily included in the Corporate and Other business segment.

(5)The year ended December 31, 2019 includes $38 million of expense related to the Facility and Operational Efficiencies Program and $4 million of expense related to prior restructuring programs. The years ended December 31, 2018 and December 31, 2017 relate to prior restructuring programs.

Facility and Operational Efficiencies Program

Beginning in the first quarter of 2019, the Company commenced the implementation of a plan to accelerate its office consolidation to reduce storefront costs, as well as institute other operational efficiencies to drive profitability. In addition, the Company commenced a plan to transform and centralize certain aspects of the operational support and drive changes in how it serves its affiliated independent sales agents from a marketing and technology perspective to help such agents be more productive and enable them to make their businesses more profitable. In the fourth quarter of 2019, the Company expanded its operational efficiencies program to focus on workforce optimization. This workforce optimization initiative is focused on consolidating similar or overlapping roles, reducing the number of hierarchical layers and streamlining work and decision making. Separately, the Company also reduced headcount in the third quarter in connection with the wind down of a former affinity program. Furthermore, at the end of 2019 the Company identified other strategic initiatives which are expected to result in additional operational and facility related efficiencies in 2020.

The following is a reconciliation of the beginning and ending reserve balances related to the Facility and Operational Efficiencies Program:


	Personnel-related costs		Facility-related costs (1)		Other restructuring costs		Total
Balance at December 31, 2018	$	—	$	—	$	—	$	—
Restructuring charges	21		16		1		38
Costs paid or otherwise settled	(15)		(11)		(1)		(27)
Balance at December 31, 2019	$	6	$	5	$	—	$	11

_______________

(1)In addition, the Company incurred an additional $12 million related to lease asset impairments in connection with the Facility and Operational Efficiencies Program during the year ended December 31, 2019.

The following table shows the total costs currently expected to be incurred by type of cost related to the Facility and Operational Efficiencies Program:


	Total amount expected to be incurred		Amount incurred through December 31, 2019		Total amount remaining to be incurred
Personnel-related costs	$	24	$	21	$	3
Facility-related costs (1)	46		16		30
Other restructuring costs	1		1		—
Total	$	71	$	38	$	33

_______________

(1)Facility-related costs includes lease asset impairments expected to be incurred under the Facility and Operational Efficiencies Program.

The following table shows the total costs currently expected to be incurred by reportable segment related to the Facility and Operational Efficiencies Program:


	Total amount expected to be incurred		Amount incurred through December 31, 2019		Total amount remaining to be incurred
Realogy Franchise Group	$	3	$	2	$	1
Realogy Brokerage Group	54		25		29
Realogy Title Group	2		2		—
Realogy Leads Group	2		2		—
Corporate and Other	10		7		3
Total	$	71	$	38	$	33

Leadership Realignment and Other Restructuring Activities

Beginning in the first quarter of 2018, the Company commenced the implementation of a plan to drive its business forward and enhance stockholder value. The key aspects of this plan included senior leadership realignment, an enhanced focus on technology and talent, as well as further attention to office footprint and other operational efficiencies. The activities undertaken in connection with the restructuring plan are complete. At December 31, 2018, the remaining liability was $17 million. During the year ended December 31, 2019, the Company incurred personnel-related costs of $3 million, paid or settled costs of $12 million and reclassified $3 million to offset related lease assets upon adoption of the new leasing standard, resulting in a remaining accrual of $5 million related to personnel and facility related liabilities.