In this October interview, Jason Sandquist and Duke Long discuss data standards with Mike Manning, LoopNet's Vice President of Marketing.
You can listen to the podcast here: http://www.crepodca.st/podcasts/mike_manning_loopnet.mp3
TRANSCRIPT:
JASON SANQUIST: Hello and welcome to the CRE podcast, a commercial real estate podcast covering all aspects of the industry. I’m Jason Sanquist with Adam Commercial Real Estate located in Minneapolis, along with my co-host Duke Long, with Duke Long Agency in West Lafayette.
Today we are joined by Mike Manning who is the Vice President of Marketing at LoopNet, where he leads the company corporate branding paid search and email marketing teams. Prior to joining in 2007, Mr. Manning was Vice President of Marketing for Edusoft, a Houghton Mifflin company and General Manager of Hooked on Phonics’ Internet business. He has over 10 years of experience in the online marketing, both to consumer and business customers. Thanks for joining us today, Mike.
MIKE MANNING: Thanks for having me.
DUKE LONG: You recently launched what you’re calling the Property Research Database. Will you give us an idea of what that is?
MIKE MANNING: Sure. The Property Research Database is a product designed to provide information to our members on the entire inventory of commercial real estate properties in their market, whether those properties are actively for sale or lease or not. Our goal is to include every single commercial property in the country. We already have over 7.5 million records and that’s growing—which makes it one of the largest research databases in the industry by a significant amount. We’re also providing a wealth of data that we haven’t typically provided our members, such as information on tenants, owners, mortgage and lender data, taxes and assessed value, historical listings (which is one of the things when I’ve talked to our members is often one of the most interesting), how the property has been marketed in the past, zoning. This is a new set of data that covers much more of the entire inventory of commercial real estate, rather than what we’ve done historically which is to provide information on properties that are actively for sale or for lease.
JASON SANQUIST: And what makes this different from the other sources of data that are out there?
MIKE MANNING: There are a lot of other data sources out there, but I think there are three things that make our database different.
The first is its size and its scope. As I just mentioned, it has over 7.5 million properties today. It covers every major property type in the industry across all 50 states. So it’s already larger than most of the other options that are out there for people today.
The second is the tight integration with the industry’s largest marketplace for active properties for sale or for lease, which is LoopNet. This is important because people typically have a need for this type of information when they’re looking for a property to buy or to lease. The need doesn’t exist in a vacuum. So for example, I may be looking at a property to buy and want to know the taxes and the assessed value. Now there are a number of places that I can go for that information and a lot of them are free, but it’s a lot easier with just a click to get from the property that I may be looking at, over to a record of its tax history and its assessed value. And then with another click to get to other information from other third party data sources, like tenant information or investor and owner information. And then, using the database’s search features and the mapping functionality, to look at that same dataset for all of the other properties of a similar type that are in the area. So there’s a tremendous ease of use that occurs by pulling all that information into one place.
Plus, as I mentioned a moment ago, because we’ve got the LoopNet marketplace data embedded in the database, I can also see 10 years of listing history–how this property has been marketed in the past—both for whatever my target property is and then for any other comparables that I might identify in the area.
The third main difference is the methodology we’re using to build the database. Over the past several years, more and more information has become publicly available, increasingly in electronically accessible formats, and I think this is going to fundamentally change the way research information is gathered, distributed and priced. So what we’ve done is to take a multiple sourcing approach to building our database. We’re of course starting with the data that comes out of our marketplace, but we’re supplementing that with public records from county assessor’s offices and other government agencies, data from leading third party information providers, our own research, and—I think this is one of the most interesting possibilities—with direct input from our members, who are often directly involved with the properties on a firsthand basis, on a day in and day out basis, and therefore have the most current and accurate information on them.
So I think that we’ve got the possibility here of creating a “Wikipedia-type” of model for commercial property information that’s going to be able to provide lower cost, higher accuracy information than has been available to people in the past. Now we talked a little bit about this last week, Duke, does that make sense? And Adam we haven’t spoken about it so much, but do those three points of difference make sense and what’s your reaction to them?
DUKE LONG: Well, I think if you look at LoopNet—and in the past certainly it has been the place to go to look at properties, to market properties, and to search for properties—it sounds like you’re moving a little bit into information services. Do you think so? And if you are, why are you doing that? I mean, I think part of it is to do the community oriented thing and bring some of the content or some of that type of data from the brokers or from the people who own the buildings, but what about the information service itself?
MIKE MANNING: Well I’d say there are a couple of ways I would respond to that. In one sense we’ve always been an Information Services company, since a large part of our business model and revenue has come from providing information about active availabilities to investors, tenants and brokers. So that’s really one type of information set, and now we’re extending that into other data sets. In some ways what I see potentially happening on the research side is a similar dynamic to what happened on the listing side. It used to be that information on available deals was closely held and not very accessible to buyers and sellers. The Internet then came along and it became possible to post listings online. So and suddenly information on availabilities, which had been very opaque, became much more transparent and it became easier for buyers and sellers to find each other. So in one sense I think this is an expansion of that into a new type of information set. On the other hand I think there’s an important difference which is that it’s not clear that a purely user-generated content model works well for a research type of product. And so that’s why we’re supplementing it with data from third party sources, and importantly we’re verifying all the things that come in as submissions from our numbers.
The second response as to why we’re moving into this—and although we have been in this business for a while of information services, this is clearly an increased investment— it is that it’s the number one thing our members have been asking us to do: to deliver a comprehensive and cost-effective resource for property data beyond listings. And we think we can do it very effectively for the reasons I just mentioned.
JASON SANQUIST: Well, I like that you guys are reaching out to your members. That definitely speaks volumes as a company and being able to listen to them and provide this type of value. As far as people having access to this kind of information today, how do you view the market for data products that are out there?
MIKE MANNING: Well, our customer surveys show that there’s a very high level of interest in this information. Seventy percent or so of the people we survey have a need for the kind of information that’s included in the property research database on a monthly basis. And over half need it weekly. So there’s a significant need for the data. There’s not as great a solution in every case. While 60% to 70% have a need for the data on a very regular basis, only about half feel that they’ve got a solution right now that meets their needs.
I would say that in my perspective the market seems to be bifurcated between very cheap or even free solutions on the one hand–public assessors’ offices and county records and things like that were the #1 most sited data source that people are going to—and very expensive solutions on the other hand that can cost several hundred dollars a month.
So I believe that there’s an opportunity to meet a need in the middle there by providing a solution that’s both affordable on the one hand (and affordable to a broad of participants in the marketplace), and is also comprehensive on the other hand. So you can get the best of both worlds. And in addition, it also has the technological sophistication that you would expect out of a site like ours or other online sites where you can search, you can plot things on maps, you can query data in a number of different ways that don’t necessarily exist right now.
DUKE LONG: How do you see the market for commercial real estate data changing? And what does this mean for people on a practical everyday basis?
MIKE MANNING: Well, I see data becoming, and continuing to become, more easily accessible and affordable, which is going to make it quicker and easier for those of us in the industry to do our jobs on an everyday basis. Mobility is going to be another important function. So we’re going to see people in the market being able to access data from out in the field wherever they need it.
An example of how this can play out in a real world sense came up in a conversation I had with a customer of ours up in the Northwest. She was showing a client office space, and the client wasn’t particularly familiar with the market. They were at one particular office building and the owner was highly motivated and offered what the broker knew was a spectacular deal. The client wasn’t as convinced because she wasn’t as familiar with the market. They went out into the parking lot, the broker pulled up her iPhone app, the LoopNet iPhone app, did a search on all similar properties within a radius of their location, was able to show her client that the deal that was on offer was a smoking good deal, and that she ought to take it. And they were able to walk right back into the office building and sign the deal on the spot. She was convinced when I spoke to her that it would have taken her quite a bit more time to go out and show her client the other properties in question, and the deal might not have been there when they got back.
I think that’s an example of how the convergence of information and access to that information, particularly in a geo-specific sense can really be the next wave of making the market more efficient and helping transactions accelerate.
JASON SANQUIST: Yeah, I love the way, the role that technology is currently playing in that and I think it’s huge. Brokers and MLS’s and providers are going to have to realize that this information needs to be accessible for people to be part of their everyday job and be doing this to the best of their ability. How do you see it affecting the industry in other ways, that people will access this type of information?
MIKE MANNING: Well I think one way is what we just spoke about which is increased mobility. Being able to access information from any time any where is I think going to be an important shift. Duke, we spoke about some of the augmented reality applications that are out there, and I think that offers a new window into the way people can get property information, by pointing their Smart Phone at a building for example and being able to see all of the availabilities in it. I think it will be interesting to see which of these technological applications get traction and are particularly useful at doing what they need to do—which is help people complete transactions faster or price things better or get smarter about their market—and which ones are novelties.
Another important area where I think that technology is playing a role is in the connection, not just of people to information, but of people to people. There’s a significant increase in opportunities for sharing information that occurs via new online channels, through new social networks and sites like that. And this is one area where the two of you as practicing brokers probably have a good sense of how technology is adjusting the way that you do business. Both of you I know are very active in social networking and that type of connection. What is your sense? How is technology affecting the way you do your jobs?
DUKE LONG: Well, I think from the technology standpoint it’s opened up everything, which is beautiful. One of the basic things with LoopNet that I loved when it came out was the fact that at last there was access to properties in general because even in my local area no commercial properties were ever put in an MLS. As far as the opening up of the networks themselves, it’s fantastic because then you have the ability to communicate and connect with people literally all over the world on a real time basis. If I need to find out about a specific type of property, I can find out that information. And you kind of went over the mobile aspect of it and that kind of a thing. One of the things I wanted to ask you, Mike, was what do you think the biggest challenge is in keeping this data information affordable for the brokerage community?
MIKE MANNING: Well I’m hoping that we’re taking a step in that direction with the Property Research Database. I know there are a lot of people who say “Oh there’s such and such service I’d love to have but it’s too expensive and I can’t afford it.” I think here again technology provides an opportunity to keep costs down. While I don’t think a pure-user generated content production approach works with a research product, I think that it can definitely help quite a bit. And the ability to keep information affordable will hinge on a couple of things. One is again the increased availability of information just in the public sphere that can be manipulated electronically which makes it easier to get into databases so it doesn’t have to be re-keyed and incur the production costs associated with that will continue to come down.
The other part of it is going to be to the extent that people share information. More participation and more sharing of information will lower the costs for the community as a whole. And so things that we can do to facilitate that sharing of information I think are going to keep the costs down. But I know there are competing incentives in doing that and occasionally reasons people don’t necessarily want to do that. And from your perspective, neither Duke nor Jason, what do you think would promote increased sharing of information and pooling of data, which in a sense is what real estate has been about all along: sharing of information with a network
DUKE LONG: Go for it Jason.
JASON SANQUIST: Well, I mean again, it’s one of those things that we’ve seen it in the residential space. I’d like to see more brokers and investors willing to share information. It just makes everybody in the commercial real estate space as a whole that much better by being able to access the information on a real time basis and not have it be two to three months old because a broker didn’t want to update the listing in the MLS. So yeah, I like what LoopNet is doing right now in trying to keep the information affordable to brokers and I like where you’re going. I think there’s a big market for that.
I wanted to talk a little bit about the mobile stuff that LoopNet is doing. You touched based on it with the iPhone use and the real world life experience and I think that’s great. I use it, the iPhone app, all the time. I prefer the LoopNet iPad app versus any search site on a computer out there right now. I think it’s just that, the usability function, everything, it’s just, it’s great. Where do you see this heading in the next few years? I mean is LoopNet putting more into the mobile space? Are you driving in this direction? Are you putting more stuff into the app market? You’re seeing a lot of stuff with the tablets now coming out. Are you going to other platforms as well? What’s in your sights?
MIKE MANNING: Right. Well first of all I’m glad you like the iPad app so much. I would say that that iPad app is evidence of one of the areas where we are going. The iPhone app came out first and then we ported it over to the iPad app. But we also added functionality when we ported it over, such as the capability to search the Property Research Database on the iPad app which doesn’t currently exist on the iPhone app, although we’ll certainly look into that. Like I said, I’m pleased to hear you’re using it and you’re liking it. I also want to hear how you are using it because it’s my sense that the display of the iPad opens up more functionality and different use cases than we see with the iPhone app. I can see the iPad app becoming a virtual tour book, for example. The bigger screen allows you to share photos, and to look at photos with somebody else a little bit more easily. I can see a world in which you can be in a building, you could pull up a listing for a particular space, you can then access the database to pull up a roster of tenants in other spaces in that building, and then take a virtual tour down the street using Google, the Google maps, or the Google, you know street view functionality.
JASON SANDQUIST: It looks like we have run out of time for this podcast. We want to thank our guest once again, Mike Manning, who is the VPRP from LoopNet. Make sure to check out .com for all the latest news and trends in commercial real estate. Remember you can find this podcast along with all other podcasts, downloadable for free at CRE Podcasts and in the iTunes store. If you have any comments, questions, or topics that you would like to hear discussed, please visit us online. Once again, this is Jason and Duke, and thanks for listening.
Wednesday, November 17, 2010
crePodcast: Mike Manning, LoopNet's Vice President of Marketing Discusses the Property Research Database
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Thanks again Mike and Loopnet for lending your time and thoughts!
Interesting discussion but for the brokerage community the bottom line, no matter what interface is used, will be price and accuracy. At some point there will probably be a merging of the various data sources which will be unfortunate because now we, as users, depend on the different sources competing with each other.
Good Discussion, Thank you!
Property information is absolutely critical to any investment real estate decision. A thorough understanding of the property coupled with expert knowledge on market trends, financing strategies, and investment performance analysis lead to great commercial real estate decisions. Thank you Loopnet for your contributions to the real estate decision making process.
Great display of how being connected improves business.
We're hosting an upcoming webinar on moving business online. Learn how to make your buildings predictable, monitor processes in real-time, and use technology to stand out from the crowd. http://bit.ly/eCWoyr
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