On a sunny day in Denver, Colorado in the Fall of 2019, Jay Soneff, Amy Garris and Marsha Laurienti gathered for a weekly lunch to discuss the Commercial Real Estate deals of the week and lament about CoStar and all the ridiculously inefficient and overpriced tech that has taken over so much of the day-to-day tasks in the industry. Longing for the days of organic communication and face to face interactions led to a deeper discussion about the ever-increasing prices and diminishing quality of the platforms we simply can’t operate and compete without.
“Wouldn’t it be nice if we could just do everything in one place and get rid of all the garbage? Surely if something really cool and effective existed, Brokers would keep listings up to date and engage in more communication and salesmanship…? How hard can that be?”. Well…. A year and a half later, the answer is …HARD! But well worth the effort!
What started as an idea that would help Brokers communicate not only properties they have listed, but also specific needs for their Buyers, potential off market opportunities and general announcements, became an effort to replace all of the platforms we use with an all-in-one search and marketing tool. Costar had recently purchased Loopnet, which had been the go-to-public-view-online-commercial-search-engine for many years, and increased the price to list properties by more than 200%. What used to cost $300/month for a Broker to upload their listings to a public marketplace now costs $600/month for just 3 listings! CoStar is the original Broker to Broker commercial MLS but is only available to Brokers with Subscriptions and multi-year contracts. At roughly $500/month per Broker, CoStar will allow you to load your listings and have them sit on their server until it pops up on another Broker’s screen as part of a specific search. There was a time that Loopnet automatically grabbed those listings to add to their public site, but CoStar ended that practice and now many Brokers, particularly small shops, and individuals, have stopped using both services and just blast out email ads to mailing lists instead. Loopnet has only a fraction of the listings it used to house and a few other search engines have popped up, but none offer an opportunity to consolidate public searching, marketing material production, and Broker to Broker communication. Costar became a monopoly and priced much of the Brokerage Community out of the game. Oddly, Costar has done little to improve their interface in recent years and the service now has a low budget feel for a luxury price. We decided there had to be a better way.
Luckily, one of our tenants is a talented Graphic Designer, James Stolzenbach, with contacts in the Coding and Engineering community, so with our heads together, the idea grew from a networking concept to an all-inclusive tech tool. By the time Lead Engineer, Bilegt Arslan joined the team, James had our vision on paper with much of the site design ready to implement. Over the next year, we evolved the concept and added features that would make our lives more productive including a social media inspired platform for Brokers to communicate without sending hundreds of emails, a Vendor piece that would consolidate the myriad of contractors and service providers we use into one place for easy access, and a rewards and marketing program that would pull the businesses in the community into the mix.
Once COVID hit, we knew we needed to make something that would actually help keep Brokers, Vendors and Local Businesses up and running, so while most of the country was in quarantine, we were cranking out ideas and testing features that could save us money and benefit our tenants and contractors when the world re-opened. The Commercial Co-Op became an idea that could reach beyond the Brokerage Community and into the industry that keeps Brokers thriving.
Having invested in the Mesa County/ Grand Junction market over the past few years, Jay suggested we use that market as our Beta Test Area and we have been engaging Brokers there for almost a year. The response is as we expected. Brokers are flabbergasted with the low-quality tech available and eager to try something new. Through many conversations, a couple of masked presentations and more than a few meetings with firm owners, we are poised to launch the entire county, which happens to be a hot market, this summer (2021). Our data entry techs have loaded two years of comps to the site and are inputting current listings for Brokers to hit the ground running. The level of interest and excitement has been building, and while our timeline has run long, we get a steady stream of contacts from Mesa County wanting to know when we will launch. This tells us word of mouth will be an important tool in our expansion and it motivates us to release a tool that isn’t just cool, but absolutely necessary.
Once we release the platform for real world testing with busy Brokers in Mesa County, we will expand our data entry efforts to the entire state of Colorado. While WE work in a large Denver Metro market, we’re discovering that smaller markets often pay for an MLS platform through their Board of Realtors dues, but these platforms are entirely built for residential deals and create massive headaches for Commercial Brokers. As part of our expansion, we will target these Realtor Associations with the option to separate the listing services and offer a basic package to the Commercial Broker Members as part of their dues with the option to enhance their suite of services for a reasonable monthly rate. In addition, we are working with the Grand Junction Economic Partnership to provide an API integrated search function to imbed in their website for future residents to browse commercial listings. We will also emphasize this service in the various markets we enter through Chambers of Commerce and related Business Organizations.
We are a very small team and have self-financed this endeavor through a cash investment from our CEO (i.e., proceeds from commercial brokerage deals), a very small PPP Loan, and lots of sweat equity. We have just contracted a second development engineer and are adding data input positions slowly.
We are earmarking outside investment to complete the site (we are currently at roughly 85% completion), roll out a marketing strategy statewide, hire data entry and account staff, and eventually start making money to pay ourselves as much of the legwork will remain with the Founders until we expand beyond Colorado.