Rate My PropTech Idea
I’ve started building out a website (well my friend who’s a software engineer is) that allows CRE companies to aggregate/archive, organize and search for the debt & equity broker OMs they receive. The interface would be identical to CoStar but the data 100% accurate – rent rolls, lease comps, sale comps, historical operating statements, etc… Would also be useful for tracking recent sale terms, debt terms and archiving market scoop.
I've worked on the buyside and we’d receive 100+ OMs / year just for office buildings in one MSA but all the info gets lost in file drives and forgotten about – especially when someone leaves the company.
Think it would be helpful to have all your old / live deals overlaid on a map and easy to find. Especially when you’ve been collecting a ton of OMs in one specific submarket and have a live deal.
If you think about it the buy side has more info than the brokers…as they’re receiving OMs from Eastdil, CBRE, JLL, Cushman, Avison, etc…
Thoughts? Think there’s demand for this?
Anyone willing to try when it's ready?
Couple issues. One, broker OMs aren't necessarily accurate, which is why any lender or investor does their own diligence. These are also asks, not actual closed deals, so thinking this will give a comp for recent sale/debt/equity terms just isn't accurate either.
I think there would be some demand, but I'm not sure that demand is coming from smart players. Every OM ever made isn't worth the paper it's printed on. It's clickbait; it's the 7 Secrets Rich People Know to Build Wealth at the bottom of the listicle.
So while it's a clever idea, and certainly has some value in showing trends in what the market expects or wants, I think that using OMs or a database of them as a source of reputable data is bound to fail prey to a garbage in, garbage out issue.
Feel free to PM me if you further want to talk things through and flesh out ideas. Always happy to work with start ups.
I have previously thought that it will be nice to actually create folders by broker, product type, market, etc or have an internal database for all the OM we receive. Candidly, I thought it will first be useful to review as I had an interest in working in debt & equity brokerage but that never panned out and I stayed in CRE banking. So I see where you are coming from but to be honest, even when I wanted to save all the OM's I was receiving, I never had the intention to use them to track or look at comps, rents, etc as Costar was giving us that info in a neat format plus using Costar gave us credibility when we made submissions to a credit committee. I have seen them shoot us down when we use comps from the OM. Secondly, I never even look at the historical operating statements and T-12, etc in the OM. It's almost worthless. Give me the source documents any day. Brokers will take the source doc and can exclude what they say is non recurring expenses or cap ex items but who really knows if they are legit. I also use appraisals from our internal closed deal database for sales and expense comps. Cant beat that.
What I will find more useful is an internal database for our very own internal credit submissions or appraisals that I can sort and filter by sponsor, market, product type, etc. If I am working on a deal for a particular sponsor, such a database will help us quickly see what is our exposure, their latest financials we have on file, if we have done a deal in that market, what was the rent comps, sales comps and expense comps we used when we last did a deal in the market, etc. This is more on us having an organized system and not so much an external business idea but your post just got me thinking how we can do much better. You will be surprised how so many firms transact in the tens of billions and do not even have salesforce or have such a clumsy organizational system, etc.