This post was originally a comment I submitted on CREvation and Startups, in response to a post titled, “Virtual Tours – Good or Bad Idea?
The CRE App Review has regularly posted reviews on mobile pano apps like TourWrist, iPhone’s iSight, Android’s Photo Sphere and Microsoft’s Photosynth and truly believe that it this type of media is the next step in CRE photography.
I am going to make the infamous comparison of residential vs. commercial real estate technology adoption…. Surprise!
Residential real estate agents have utilized some shape or form of “virtual tour” for nearly a decade.
So, why such a lag in adoption for CRE? Perhaps, it is because vacant commercial space isn’t staged like residential is. For instance, the vacant space on the video in this post was kinda beat up, so as the landlord’s listing agent, I would be pretty apprehensive about publicly posting images of the space’s condition in the fear that it would deter potential tourees, right?
But as a tenant rep broker, wouldn’t being able to provide a 360 of each potential space prior to your tours be helpful during your client’s screening process? [Similar to the one below:]
One of the key differentiators for 42floors is professional photography. Why is this? How hard is it to take a decent photo of the space and post it to Loopnet. Not that hard, right?
But, I bet 98% of the for lease product on Loopnet (and maybe 100% on Costar) are exterior shots only!
Why? Because the listing broker or landlord is embarrassed to publicize that the space has been beat to [crap].
42floors publicly acknowledged that one request they heard before they rolled out their site in NYC is that each listing needed better photography.
What did 42Floors learn from its launch in SF that it’s applying to the NYC market?
[...] users really want photos — building photos, floor plans, interior photos, etc. When we launched in San Francisco, only 20% of our listings had photos, the rest just showed the Google Street View of the address (which was often the wrong building or a blocked view, etc.). For New York we made a huge push to get photos and 80% of our listings had photos at launch with more on the way.
Why is this? For one, it may be because a large majority of their users are tenants who are not yet represented by an agent.
The other thing we’ve learned in the last 6 months is just how many tenants come to our site who don’t yet have representation. [...] And it’s going to happen at an incredible scale. We’re going to have thousands and then tens of thousands of tenants that come to us without a broker and want our suggestion with which broker they should partner.
Being that many are unrepresented, it most likely means they aren’t using Loopnet or Costar. Heck, they may not even know what Loopnet or Costar is, they just Google “Office Space [City Name]” and see what comes up.
Commercial real estate marketing is moving the direction of residential real estate, only ten years later… Think Zillow and Trulia. Just because these sites exist doesn’t mean prospective buyers aren’t using brokers. These sites just help buyers pre-screen and identify their options before engaging one. The same will soon take place in commercial real estate.
Tenant Rep Brokers should embrace this evolution, because it will reduce the amount of time it takes to screen prospective spaces.
Landlord Reps and Owners should also embrace this trend because it offers a way to differentiate their space over another. And the ability to differentiate a product means it is less likely to be come a commodity whereby the only basis of competition is price.
An unrelated example: Have you ever bought or sold something on Craigslist?
What percentage of Craigslist listings actually have photos? 5%?
The times you bought something, one reason you considered it in the first place is because the listing included a photo, right?
Whenever I post things on Craigslist for sale, I break out the old Nikon and take a couple good pics.
I just sold an old couch for in the basement for $200 in less than 24 hours. I got 5 phone calls and 10 emails in less than 12 hours after posting, largely because of the photos.
And, ugh, this couch… little did these 15 people know, I would have paid them to haul it off.
Other listings of [crappy] couches with no or terrible photos?… They are probably still listed weeks later. Why don’t these other people post photos of what they are trying to sell? Pure laziness.
My point is this: CRE Virtual Tours will become commonplace. It already is in residential, mutlifamily and hospitality. Office, retail and industrial are next.
As soon as brokers and owners notice that tours actually increase when decent photos or virtual tours of their vacant spaces are included in public listings, this practice will spread like wildfire.