“Knowledge is power. It’s a motto that accurately sums up much of the real estate business as well as the PropTech industry. Regardless of your role, access to information is what separates the winners from the losers. For brokers, it could be information on renters and buyers, as well as market data. For owners, it’s property analytics and consumer information. For developers, perhaps it’s competitive intelligence.
Within the world of PropTech, some of the biggest players in the business have staked their success off of information. CoStar, for instance, is an information broker. With LoopNet, CoStar also controls much of the information the industry uses to compare and evaluate investment or rental opportunities. CoStar wants to be a one-stop-shop, the only game in town. And it’s true, centralizing the marketplace off of one main platform has advantages related to scale and coverage. But it offers downsides, too: brokers and buyers see what CoStar wants them to see, and search using the criteria CoStar lets them use. What’s more, poorly-listed spaces can steer potential investors away from good opportunities.
One commercial marketplace that looks to act as a disruptor to the system, CoeoSpace, which aims to keep the entire space search process completely transparent and focused on the user. They do this by giving plenty of search criteria as well as a tiered ranking system for property quality and an algorithmic matching system for users and spaces. CoeoSpace is also free for both space users and listers, with plans to integrate an ad-supported model in the future.
“What we saw was the need for a consumer and a broker to be able to find space easier,” said Kim Ford, CoeoSpace’s co-founder and CEO. For Kim, one of CoStar’s major shortcomings is its inherent lack of clarity. In CoStar, Kim pointed out that plenty of listings without properly-detailed listings still require a phone call, thus limiting the platform’s effectiveness as a true marketplace in and of itself.
Kim also pointed to CoeoSpace’s “coFactor” ranking system as a standout feature. CoFactor scores buildings into Bronze, Silver, or Gold levels based on their amenities and features. A main goal of the tool is to help businesses scope into the right properties that most closely match their amenity and space criteria. “What we think that’s going to enable major corporations to do is say ‘I only want to look at buildings that have coFactor,’” Kim added.
The idea of a scoring system for buildings is an interesting one. CoStar, of course, has its own star-based ranking system, but its implementation often seemed to me to be an afterthought. Myself and the brokers and investors I worked with would never reference a CoStar score, instead favoring the more industry-standard letter grade system. This represents an opportunity for CoeoSpace, coFactor ranks amenities submitted by property owners, instead of doing original research like CoStar and hopes to become a industry standard rating source much like LEED’s sustainability certification system.
There have been many companies that have tried and failed to claw their way into the competitive commercial listing market. There seem to be even more that are jumping into the fray, VTS expects to have its Truva marketplace up and covering their home turf of NYC by this fall. Marketplaces have network effects that can make it hard to challenge an incumbent with lots of market share. But even the most strategic positions often fall to innovative upstarts, just ask the retail giants of yesteryear, if you can still find them.”