Commercial IDX. Interesting guest post from John Ziemba.
Does commercial real estate need IDX?
I think so. I’ll first start out defining what I consider to be an IDX, an IDX is the ability to show all the listings including other broker’s listings on your website. Today’s consumer is online and has access to more information than they have ever before. In the commercial real estate world there has not been a push to centralize all the listings and offer consumers a one stop shop to look at listings. For a consumer looking for commercial property, there are a few places to look and they often don’t give then consumer what they are looking for, listings.
Where is the consumer looking NOW?
Let me explain what I mean by this. One of the most likely places a consumer is to look is on Craigslist, looking at this database of properties it is very incomplete and only offers a very small amount of properties with limited information on the specific property. I understand some commercial brokers have gone out and used html templates or services like Postlets, but by in large this is the exception, not the norm.
Moving on the next solution, a consumer might go to Google and type in “City Commercial Real Estate”, the consumer might find some of the more local companies or possible a link to a Loopnet Listing. Let’s analyze both, so the consumer clicks on John Smith Commercial Real Estate or even Big Name Company Commercial Real Estate and then goes to look for properties on their specific sites. The consumer will most likely only find a limited number of listings on each particular site, limited to the company’s own listing inventory. If the company does not have a large inventory of that particular property and let’s face it not all companies are going to have a large amount of inventory for each property type, the consumer is not finding what they are looking for. What if a company is a member of a local commercial MLS (multiple listing service) or CIE (commercial information exchange), by in large the MLSs only display a fraction of the data because most commercial real estate brokers are not members of the National Association of Realtors® and do not have access. With a CIE, participation is dependent upon the local movement and most of them are not offering any type of IDX solution.
Ok, now the consumer does not like those results and they have ended up on the Loopnet, site or for a lesser extent the CoStar Showcase site, so now there’re cooking right? Wrong they start an account on Loopnet, log in, only to get a pop up asking them to be a premium member, as a basic member they only have access to only a small portion of the actual listings. With CoStar it is even worse, the consumer really only gets to see the few “Showcase Enhanced” broker listings. From all the brokers I talk with the success with CoStar’s Showcase service is nonexistent and with Loopnet it is a tossup with respect to lead generation.
In addition the next option for a consumer to find commercial properties is a consumer facing site like CommercialSource and there are many others. While this offers a way for consumers to search commercial real estate listings available, the listing inventory is incomplete at best and does nothing for a broker to further their ability to identify their value proposition.
Why IDX will work.
Ok, so now why would a commercial IDX work? Frankly, I think it would change commercial real estate. Here is why, SEO now becomes important. With a properly designed website, a consumer would search for City Name Commercial Real Estate and then your site could be one of the top ranked sites. The consumer then clicks on your site is able to view “all” (a good amount) the listings in a specific area and for their specific property type. In addition, it now makes your site more valuable and useful to the consumer because it is a resource hub and in turn creates true lead generation from the internet.
The 2 biggest challenges I get from other brokers about the success of a commercial IDX are: commercial real estate consumers are not online and the big companies will not let you have their data for their listings. I believe both of these items to be false, similar to old wives tales. The big companies are already giving their data to Loopnet and CoStar. In the case of Loopnet they are most likely even paying to have their properties as a premium listing so that the general public and basic members can see them. With CoStar they are giving the information to CoStar and then buying it back with access to their comps service and the other CoStar services like property advisor & tenant. Hello, people where do you think they get the tenant data that they sell to the other brokers to help the “find clients”. To me it is obvious that the brokers are not afraid to give their data away.
Commercial Real Estate Consumers are not online, right? Just ask the secretary of the Doctor who is doing the Doctor’s search for new space. Having listed medical space the actual end user never calls me it is always the practice manager or receptionist and they usually tell me something like this, the Doctor asked me to find them a new space for their practice. Ok, maybe that example is juvenile and doesn’t pertain to YOUR type of business, look at both the success of both Craigslist and Loopnet, which has over 4 million members and tell me the consumers are not online. Do you hear their cash register ringing?
Just my thoughts,
Many thanks to John for taking the time out of his busy day to provoke some conversation and put his opinion out there.
Commercial Real Estate IDX. Now how about your thoughts?