Regulations and Implications of Drone Technology

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Unmanned Aerial Vehicles (commonly referred to as “drones”) are without a doubt changing the commercial real estate transaction and marketing process. The use of technology has enabled brokerages to effectively market properties by providing quality aerials, parcel layouts, and give prospective buyers a larger perspective on how a property fits within the local market. Property owners and managers can use drones to keep an eye on their properties or show vacant spaces. Even online retailers are experimenting with delivering products via drones. However, it’s equally important to understand the rules and implications of using such technology. It is tempting to rush and purchase a drone and start watching it soar through the skies, but policies have tightened over the last few years. We’ll also share how to use drones for marketing your properties, so come back to see our newest posts. Before you fly, here are four (4) major impacts to consider:

1. FAA Regulations

On June 21, 2016, FAA released new regulation which took effect on August 29, 2016 (Part 107 to the Code of Federal Regulation). An individual must obtain a remote pilot certificate by meeting several requirements including, but not limited, to passing an initial aeronautical knowledge test or hold a part 61 pilot certificate. It is also important to note that this only applies to commercial drones under 55lbs. Aircraft over 55lbs must be registered and undergo a pre-flight check to ensure Unmanned Aircraft Systems (“UAS”) is in condition for safe operation.

2. Flying Restrictions

Some properties and areas may be under a restricted No Fly Zone. Drones can operate in Class G airspace. Recreational operators are required to give notice to UAS, the airport operator and air traffic controller, of its intent to fly within 5 miles of the airport and obtain the necessary approvals. Otherwise, other notable restrictions, including around stadiums, are prohibited within one hour before or after the scheduled time of an event. If your property may fall within a restricted area, it will be important to keep such restrictions in mind or obtain the necessary approvals before flying.

3. Operational Guidelines

To operate under Part 107 of the Code, the drone must adhere to the following operational guidelines: the aircraft must be in visual line of sight; fly under 400 feet and during the day; fly below or at 100 mph and not over people; and not fly from a moving vehicle.

4. Drone Options

There are several cost options when deciding upon a drone. A multi-rotor is the easiest and usually the least costly. It is typically used for aerial photography and videography, because they have great control over position and framing. Such drones, however, only run about 20-30 minutes on a charge. A Fixed Wing is the costlier option, but it is more efficient. Such drones can run for 16 hours or possibly more with fuel. The downside is they can’t hover in one still spot, so they are not ideal for general aerial photography.

The drone industry is growing quickly with U.S. industry experts predicting the creation of 100,000+ jobs and generating more than $82 billion in economic impact over the next 10 years. There are even attorneys specializing in the drone practice field by providing business formation, compliance, and obtaining FAA waivers. For real estate brokerage firms, many are sourcing companies and individuals with the proper licensing. This may make the most economic sense in the interim where the opportunity cost of FAA regulations and licensing may not be worth it. Larger brokerage firms and real estate companies may decide, in the near future, to incorporate full-time staff and personnel. The potential is here and will continue to grow.

Regardless of the complexity of issues, safety and privacy concerns, drones will most likely continue to be a valuable resource to the commercial real estate industry.

Real Capital Markets : A Resource for Online Marketing

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One of the greatest tools we have found in utilizing technology within our property marketing is leveraging the third party platform Real Capital Markets (RCM). Although it is attached to a distinct price tag, the platform is a one-stop-shop for all of our property marketing needs. The platform not only allows you to create a unique website for the property equipped with its own domain, it can send property emails, keep an on eye on real-time reporting, and provide immediate war room access to qualified investors.

Know Your Pricing Options

There are different pricing options for the platform (for more information on pricing please contact RCM), and our team has utilized both the DIY Package and the Silver Package. The main difference between the two is that the Silver Package includes RCM’s distribution list of qualified investors, and depending on your pricing rubric – a thousand dollars. The purchased distribution information is proprietary and protected by RCM, so certain items are hidden from the user such as email address. There are two higher packages, Gold and Platinum Package, which offer additional support in creating the “teaser” or landing page as well as additional email building support. These two packages would be ideal for a team that did not have the graphic support capability to create and execute the design elements for a landing page or eblast on their own.

RCM also offers exceptional support. It took me a few months to figure out how to fully navigate through the platform, and their support staff was with me every step of the way. With each new project, you are assigned an account manager who will be able to help you with any questions you might have.

Reporting Metrics

One of my favorite features is the RCM Reporting tab. Not only is everything in real-time, the interface is easy to use and there are also notification features. Everything is vertically integrated within the platform, and reporting begins from viewing the landing page, to the initial eblast, and all the way through downloading documents from the war room. You no longer have to visit several platforms to provide your client with updated and accurate reporting, RCM provides it all in one place.

Another great feature is the notifications. RCM sends a bi-weekly report and you can also set up your own personal notifications to receive an alert when someone executes ta project’s confidentiality agreement. Our team loves this feature because it is a wonderful, real-time gauge of the market’s interest in a specific property/project. Yes, a surge of emails filling your inbox could be somewhat distracting, but it is also a great way to see property interest and build genuine excitement about the marketing campaign itself.

War Rooms

RCM has set a high precedent on what a War Room should be and how it should interact with your marketing platform.

The War Room itself is user-friendly and provides you with multiple security settings. This is where our team typically houses the property’s offering memorandum and all of the property’s due diligence.

The offering memorandum and any other information we would want someone to initially receive about the property is typically set to low, while higher level due diligence items such as leases and sensitive financial documents are set to medium or high. And the wonderful things about the RCM War Room is that clients can access the low-level information immediately after executing the online confidentiality agreement.

Please do keep in mind that RCM does allow you to manually approve each person who enters the War Room even if they execute the CA, and for some brokers this is preferred. Our team has found that adding additional security measures has no added benefit to the low-level information. Our distribution lists are already filtered and find that a best practice is to let people get the information as soon as and with as much ease as possible.

In conjunction with the reporting, RCM allows you to see who has downloaded specific documents, what they have opened, and their time stamped activity within the War Room. In my experience, no other service out there has been able to provide this in such a user-friendly and aesthetically pleasing interface.

There is an initial storage limitation on of 100 MG to the War Room, but there are also options to purchase more space if needed.

Cross Linking Between Platforms

Something that we have also found useful within our property marketing is that RCM allows you to cross link to their platform. RCM does limit the amount of full distribution blasts you can send per project. Each project is allowed two full distribution blasts. This stops people from sending mass amounts of emails to their distribution lists, which in turn protects RCM and RCM’s distribution list from SPAM complaints.

Although this may seem limiting, this is one of the factors that make’s RCM’s purchased distribution lists so effective. They take these extra measures to ensure that the people on their lists are active users. Do not fear, you can send additional (and unlimited) emails to “approved” users, or those that have engaged in the marketing campaign. RCM will also make additional exceptions if there are significant changes to the property such as a notable price adjustment.

There will be times when a team will want to send another email to a full distribution list after using the initial two blasts. The great thing about that is you don’t have to lose any valuable reporting by going through another e-blasting platform. RCM has built in generic links to both the project’s landing page as well as a confidentiality agreement. By placing these generic links into the other platform, you are still able to filter all the reporting through RCM. These generic links have proven to be invaluable not just for additionally blast, but for answering property requests that have been sourced from third party sites such as Loopnet, Costar, and Propetyline.

RCM really has done a wonderful job in supplying brokers and marketers with all the tools needed to create and execute a successful marketing campaign. My only criticisms of the platform really lie within the pricing and time limitations surround the lifespan of a project, but those things are extremely subjective and do not diminish the many benefits you receive when using the platform.

Please feel free to contact us with any questions you might have on the platforms functionality as well as our team’s best practices. We have utilized the platform for years and have found it to be one of our greatest marketing tools.

Millennial Insight on Retail

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For most, it’s easy to think of a millennial as a teenager with a phone attached to their hand or constantly binge-watching Netflix shows but the reality is that this generation is growing up and so is its retail habits. The most important thing to realize about this generation is the great diversity within it, primarily with its age range. It includes anyone born between 1978 and 1995, which means the oldest millennials are roughly 40 and the youngest are 22. This is a large gap that encompasses many milestones. As a millennial on the younger side and a college student, I have much different spending habits than someone born more towards the beginning of the generation who is in their 30s, perhaps married with children. It is important for retailers to focus on catering to all sides of the spectrum. As more and more millennials are starting to make the shift into the majority of the workforce and consumers, retailers should understand and re-evaluate where millennials’ shopping habits are currently. By doing so, this can help qualm some fears and anxieties about the future of retail to tenants and investors. For more information how generations have affected and adjusted to the industry, click here.

Online Shopping

While the convenience of a mobile platform is paramount to millennials, it is not the only reason they keep gravitating more towards cyber-retailers; it’s simply the best way to see what is available on the market. As established, a lot of the generation’s time is spent online, and in particular social media sites. Naturally, some profiles stand out more and the owners of these accounts have now become known as “social media influencers”, the use of which can be crucial for a lot of retailers. To give an example, there are many influencers, which also include bloggers and vloggers, who demonstrate or try on their purchases in picture or video format. They often link where to buy the products or tag companies, making the purchasing process very simple as well as giving exposure of the brand to thousands of people with just one photograph. It can be seen as virtually trying on or testing products. However, social media is also a proponent for why millennials still go out to get one thing they can’t online: experiences. Well, that and no shipping prices.

Experiences Matter

With cost of living and student debt constantly rising, it is no wonder why millennial spending habits are adjusting. If there is an opportunity to spend $20 on a new top or trying a new restaurant, most would choose the latter. This is true for a few reasons, one of which being its correlation to social media. You can post via various apps where you are and what you are doing to showcasing to friends your experience and awareness of what is “cool”. Going out also allows for social interaction and promotes the popular wellness of the work-life balance. If most of one’s spending money was spent on material items, it wouldn’t leave much to spend with friends and activities. Since a lot of millennials’ time is spent online, human interaction is crucial to social life. This is why restaurants, bars, trendy workout studios, and activity centers have been left undisturbed by the “retail apocalypse”.

The other reason for shopping brick-and-mortar is the fact that it is a leisure activity to partake in. Though we like to buy online, there is something far more gratifying to have a product immediately —another defining quality of the generation. Personally, if I have time, I greatly enjoy just wandering down each aisle touching, feeling products, reading labels and being around other people doing the exact same. Additionally, shopping itself can be seen very therapeutic. Studies even show that “retail therapy” can been a useful strategy in trying to improve one’s mood [Atalay, Meloy]. Retailers can use this as an advantage by making the shopping experience cater to consumer’s senses – free samples or demonstrations, a distinct smell in the store, live music or other events on weekends, etc.

Ethical Spending

For a long time, the biggest fad was trying to constantly discover the next fad. However, recently there has been a slight decline in materialism. There is a large emphasis on ethical buying and natural products. People are becoming more engaged in politics, cultural, and societal issues which can translate to their purchasing habits. For example, some shoppers may be less likely to buy something from stores that partake in child labor, support certain politicians, or fire people in favor of machine automation. Millennials are less likely to spend money unnecessarily but when they do spend, they prefer to give money to brands with positive and sustainable business ethics, even if that means shelling a few extra dollars. The graphic below [Psychologytoday.com] showcases that majority of the generation’s expect more of large corporations than just the products they provide.

In conclusion, there are several more aspects that retailers should be taking into consideration when designing products and services toward millennials. While stereotypes of the generation may exist for a reason, some are quite outdated and creating marketing tactics towards them will not benefit the producer or the consumer. Tapping into what current trends or habits are occurring could mean tapping into a larger potential and profit.

 

Boomers and Millennials – How Two Generations are Transforming Retail

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Contrary to popular belief, internet retailers are not the sole drivers behind the closures of some of the most iconic retail brands of the last 50 years. Brand names such as Sears, K-Mart, JCPenney, Macy’s and Sport Chalet are shuttering their doors because they are struggling to transition from how the Baby Boomers shopped to how the Millennials seek to experience shopping.

Plain and simple – I’m tired of hearing how this is the end of retail. I don’t believe that power centers will become distribution hubs and that “bricks and mortar” retail will continue to die a slow death. Instead, what I see is a paradigm shift from the way we looked at the lost art of retail to how the next generation is transforming the way we experience shopping altogether. In order to understand how shopping centers are retailing we should look at how the Baby Boomer generation once influenced retail and how the Millennials will now transform the retail industry.

The Boomers

8,000 new shopping centers were built throughout the 1960’s and 1970’s in response to the tremendous demand from the Baby Boomer generation (born in between 1946 to 1964). It is no coincidence that K-mart, Walmart, Kohl’s, Rite-Aid and Target were all born in 1962, followed closely by Best Buy, Crate & Barrel, Gap, Petco and Pier 1 Imports. The Baby Boomer consumers were largely white, middle class children from a two-parent single income home and, broadly speaking, liked the same stuff. This made it extremely easy for retailers to cater, predict and deliver on consumer demands.

In fact, the demand was so great that creativity gave way to production to satisfy the consumer and nobody complained. As the Boomer joined the workforce and started to have families in the suburbs, developers and retailers responded by building large format or “power center” shopping centers. These power centers attracted “Category Killer” tenants such as Walmart, and Home Depot, that could deliver products cheaper and at a massive scale. This tremendously affected the traditional mom & pop retailer that could no longer compete with prices. In Doug Stephens’, book The Retail Revival; he calls this period the Industrial Devolution; a period where retailing ceased to be a craft and became an occupation. The new era would bear witness to the displacement of personal service, unique products and artful merchandise by stack-outs, blowouts and rollbacks. Quality would take a back seat to availability, and abundance would triumph over substance.”

Between the years of 1980 to 2005, when the Baby Boomers were at their earning prime, the US economy grew 100%. This growth concluded with the great recession of 2008.

Now, almost 10 years after the great recession and 55 years after the last Boomers were born, most Baby Boomers are past their earning primes but are still holding on to executive level positions while shifting their disposable income from retail consumption to travel and health care. Retailers are still slowly recovering from the recession but must now adapt to new consumer demands generated from the largest generation since the Baby Boomer: the complex and diverse Millennials (born between 1981-1997).

The Millennials

Millennial consumer demands are a 180-degree turn from the Baby Boomers. Unlike the vanilla Boomer, Millennials come from various cultures, ethnicities, educations and socio-economic status. This dramatic shift in consumer tastes is proving problematic to the various retailers that have not adapted to the new wave of demand led by the Millennial consumer.

Why should every person involved in the shopping industry care about Millennials?

Because they are the largest generation in U.S. History and have a higher net worth than any previous generation according to a Forbes Magazine article written by the CEO of ICSC (International Shopping Center Council), Tom McGee. Forbes Magazine states that 14% of them already have a net worth above $2,000,000 and they have not yet reached their prime working and spending years. They are spending more money on entertainment and dining than any other generation. And as a whole will allocate a lot more of their disposable income towards “experiences.”

“It’s not that we are lazy,” states Marisa, our 22-year-old marketing intern, “we just take pride in figuring out how to make things work for us quickly. It’s called “Life-Hacking”. Marisa is the ideal millennial to provide me with insights into their purchasing rituals. She just completed all the courses for her bachelor’s degree at the University of Southern California but instead of heading into the workforce, she is opting to stay an extra year at USC to complete her Master’s Degree.

Here is what I learned from Marisa, and what retailers will need to learn in order to prosper.

Influencers

Most of her time is spent online and it bleeds into her shopping habits because she follows bloggers who demonstrate or try-on purchases in picture or video format. If she decides it looks good on them and she wants to try it on, she buys it. The bloggers will link where to buy the product, making it convenient for her to click on the link and make the purchase.

Purpose

For a long time the biggest fad was trying to discover the next fad; however, she has recently noticed a decline in materialism and a large emphasis on ethical buying. Her peers are more engaged in politics and cultural issues, which means that they are less likely to buy something from stores whose values are not aligned with theirs.

Experience

With limited disposable income, she will choose to spend $20 towards trying a new restaurant over buying a new top. She will pick the restaurant for the following reasons: a) she can post about it on social media, b) she can discuss her experience with her friends and c) it allows her to have social interaction. Since she spends most of her time on online, she cherishes the opportunity to spend time socially with friends. She will admit that the majority of her disposable income is spent on eating, drinking, Ubers and gasoline.

When it comes to actually going shopping, she only goes if they accept credit cards over cash- since it is very rare she has cash. She will rarely visit a shopping center but when she goes, it is because of one of three things; a) it is for a very specific item, b) there is a coupon involved or c) the EXPERIENCE. She enjoys going to Target because it is therapeutic. She will venture into stores to try clothes or make-up if time allows for it but will rarely purchase an item.

For more detailed information on the shopping habits of Millennials click here.

The difference in retail habits between Baby Boomers and Millennials provides a perfect case study for the premise that retailing is not dying a slow death, it is simply evolving to meet the needs of the new generation. Those retailers that understand and capture this new customer will thrive.

The Baby Boomers led the way in consumerism and retailers responded with big boxes, mass quantities and “low” prices. Millennials are bringing back the lost art of retail, by demanding an experience, convenience, quality and purpose. We will see over the next few years which retailers will meet these demands and which ones will fail to catch up with today’s main consumer.

What the California Legislation on Dual Agency Means for You

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When the discussion of dual agency occurs, commercial real estate practitioners may rarely think of its implications. However, dual agency involves all parties including sellers, buyers, landlords, and tenants of both residential and commercial properties. California currently allows dual agency, so long as it is disclosed to the parties involved: a broker can represent both sides in the transaction. Some states, such as Colorado, Kansas, Florida, and Wyoming, prohibits dual agency; many others follow along the same lines as California. Recent proposed legislation by Assemblywoman Lorena Gonzalez, D-San Diego, could change that and the way we transact.

What is Dual Agency Legislation?

Assembly Bill 1059 was introduced by Gonzalez and would prohibit a brokerage firm or its licensees from acting as a dual agent. This impacts the entire brokerage firm. If passed, this would mean that Colliers International as a firm couldn’t act as a dual agent for both a seller and a buyer in a transaction, even if the buyer was represented by an agent in a different office.

In January 2015, Senate Bill 1171 was passed requiring disclosure of dual agency and agency relationships in a commercial property transaction; residential transactions already had this practice in place. The bill was also introduced shortly after the California Supreme Court ruled unanimously that a real estate professional representing a seller on a residential home purchase owed a “fiduciary duty” to both parties if the buyer’s agent works for the same brokerage. The ruling stated, “It is undisputed that Coldwell Banker owed such a duty to the buyer. We now conclude that the associate licensee, who functioned on the Coldwell Banker’s behalf in the real property transaction, owed to the buyer an ‘equivalent’ duty of disclosure.”

Varied Opinions On The Bill

Some proponents of the proposed legislation come from the commercial real estate community. Hughes Marino, CEO of a San Diego based tenant representation firm, believes this will provide more transparency. According to CoStar, Hughes states, “prohibition of dual agency would truly level the playing field for tenants offering them legitimate transparency and conflict-free representation.” Opponents believe the bill is too extreme and could change the commercial real estate industry in California. Another bill was introduced AB 1616 by Assemblywoman Jacqui Irwin, D-Thousand Oaks, where instead of banning dual agency all-together, expands current disclosure requirements. Both bills coupled with the Supreme Court ruling show evidence that there is increased focus on the consumer, to limit both potential conflicts of interest as well as increase transparency.

While AB 1059 does have some hurdles such as going through committees, the Assembly, and State Senate, before being sent to the governor, there is no doubt that this could cause disruption within the real estate brokerage community, especially among larger firms, and can certainly impact future real estate deal making. Brokerage companies, agents, as well as clients will need to pay close attention as the bill progresseses.

For more information on AB 1059, please visit: California Legislative Information.

How Leasing Agents Can Create Value In The Sales Process​

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As a commercial real estate broker specializing in the sale of shopping centers, I value the relationships that I have built with retail leasing agents over the years. In fact, my early mentors were mostly leasing agents and I have shaped much of the style I use in selling shopping centers with what I have learned from retail leasing professionals. This is why it bothers me when I witness missed opportunities, such as when a property​ owner decides to sell a shopping center and the leasing agent does not get included in the sales process.

Leasing Professionals; The Unsung Hero​

Leasing professionals are at forefront of value creation, from assembling the right mix of major tenants for the shopping center to persistently finding the right tenant for that last, hard to lease, space. The leasing agent is the unsung hero that grinds out the lease negotiations to stabilize the property’s income stream however, when the landlord decides to sell the Property the unsung hero often gets overlooked from participating in the sale. This prohibits leasing professionals from earning a well-deserved fee from the sales commissions.

In most instances, property owners value the leasing professional for a reason, and it is tough to be an effective leasing person and handle sales transactions. This is where collaboration with Investment Professionals, like myself, will yield leasing agents well-deserved dividends from their labor. If this sounds self-serving, it is! I want to team up with leasing agents to help them earn a commission from the projects they leased. I am an investment sale professional with a 23-year record of selling shopping centers. That is all I do! I have an experienced team and collectively we underwrite position, distribute and effectively negotiate a shopping center sale, but I always need the local trade area knowledge and first-hand experience with the subject shopping center and its leases. This is where teaming up to drive value to the overall transaction will be the most effective.

Partnering on RFPs​

In one of my most successful partnering scenarios, I collaborated with a leasing professional from another large brokerage company. They wanted to collaborate on a response to a request for a proposal to sell two shopping centers across from one another.​ The ownership was a New York-based institutional fund adviser whose clients had owned the property for close to 20 years. My partner, on the transaction, had been leasing the property for close to 10 years. He chose to reach out to me because he did not have anyone at his company with the proper experience to sell a shopping center. Even though it is unconventional to collaborate with different companies in the sale of a project, there was a compelling reason why it made sense for us to team up for this assignment.

Our team had recently completed the sale of similar projects and the leasing agent had a long history of leasing the property with a strong familiarity in the trade area. He had already completed leasing the remaining available spaces to stabilize the income stream, and felt that there was still more value when some of the short-term leases expired and the spaces were either r-leased or renewed. This presented a valuable story to potential investors in order to maximize value for the property.

Results​

Our team collaborated on the proposal presentation and beat out two other sales teams for the business, the combined team of leasing and investment experts was the difference maker.

During the marketing process our collective team was able to handle several objections from investors who questioned our leasing assumptions. We were able to demonstrate intimate familiarity with the trade area and highlight appropriate comparable lease transactions. We also proved strong tenant demand by producing LOI’s from perspective tenants.

We ended up completing two transactions, one tailored for a strategic ownership of the remaining shop spaces to the main grocer tenant that already owned their parcel and the second to a value seeking syndicator who had investors in an exchange. If the leasing agent who had worked for almost 10 years to add value to the property would not have reached out to our team they would have missed the opportunity for a sale and the ownership would not have yielded such positive results.

Opportunities to form partnerships between investment and leasing agents come in many shapes and forms. They may not always be appropriate but if you are an investment agent and the project requires the hands-on knowledge of the leasing agent or if you are a leasing agent and the project requires the technical experience of an investment agent, the combination of experiences will produce outstanding results.

If you’d like to learn how we can help you, contact us here​:

 

Understanding the Buyer for Your Shopping Center

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Winning the business is half the battle. Marketing the property with a comprehensive and precise marketing campaign therein lies a greater challenge. If positioned incorrectly, the property will not sell, the marketing methodology becomes diluted, a team loses credibility, and a long term relationship could be lost.

Sellers want to feel confident that their property will sell, quickly, and that they are working with a team that has proven their ability to properly position a property on the market.

Typically, marketers and teams will focus on external elements such as a property’s location, tenancy, and pricing metrics to formulate the overall marketing strategy and positioning. Our team tends to work the other way. Our analysis of the property goes deeper and into the minds of different buyer profiles. Our buyer becomes “ground zero” for all positioning and marketing methodologies.

The key to precision is positioning the buyer, not the property.

Understanding Your Buyer

The key to properly positioning a property is understanding the buyer and their corresponding risk categories. The higher the yield on a property; the higher the risk.

When our team is awarded a listing, we use the chart below to define the different categories of buyer profiles and their corresponding risk categories. We look at where the property would fall within this chart and begin from there.

What Next?

Once our buyer and risk category have been established, our marketing materials seamlessly fall into place.

Specific buyer profiles lend to specific styles. Let’s say a property falls within the Fund Adviser bucket and a trophy property (Q3). Our team would create a financially driven offering memorandum, with less imagery and more substance. In this case, we are speaking to industry professionals that are looking for exact information and specific terms. They are clear with their requirements and the marketing materials are then focused on messaging that resonates with those buyer profiles​.

If we were catering to a profile in Q1, the offering memorandum and materials would be a little more vibrant and picturesque. We would include information that would emotionally drive a buyer in this quadrant to feel confident in the possible investment. At times these investors are also more drawn and sensitive to regional connections, tenants, and the inherent narrative and nuances of a property. Since these properties might pose higher risks than those found in other segments, our marketing materials would have to lend to those characteristics.

The Art of Positioning​

The art of property positioning lies in the ability to translate the raw property data to our property positioning rubric. Decades of experiences have provided our team with the ability to analyze subtle nuances, analyze the projected yields, as well as the long term viability of the potential investment.

Of course there are outside factors that can also change the effectiveness of positioning the property based on a certain buyer profile. We have had instances where the market has shifted during a marketing campaign, changing not only the buyer profile but also the content of our marketing materials, and at times, creating a whole new set of marketing materials.

Above all, being artfully adaptable is the best way to complement experience. For more information on our proven process, or to find out where your property is on our chart, contact us here:

Bringing Technology To Market

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Baking a pie takes precision and strategy, a careful measure of all the ingredients creating the perfect formula. The pie crust needs to be the right consistency and bake to support the filling. Timing becomes the catalyst to perfection. Thankfully, today’s modern technology has supplied digital scales, timers, and thermometers that have taken away most of the guess work, providing many with the tools needed to achieve culinary success.

Marketing for commercial real estate has also experienced similar advances in technology that measure campaign metrics and provide the data to help perfect one’s marketing methodology.

Our team has learned to lean on much of this technology to build our marketing process and ensure both precision and efficiency.

Digitize all Materials

Most of our materials are now digital.  Although we do make printed collateral for our team marketing, we always accompany each piece with a digital version.

Digital Materials not only help track open rates and additional metrics, it also allows for incorporating interactive elements that are not traditionally utilized in the industry. As a marketer for Lagos Shopping Center Advisers, I push our team to breathe new technological innovations into our campaigns. No longer are the days of printed collateral, mailers, and faxing. Everything needs to be instant and easy to access.

Our team utilizes a few platforms to ensure investors can access the property marketing materials immediately – our go-to being Real Capital Markets (RCM). Their user friendly interface not only allows for immediate access, its aesthetics are sharp and the platform is easy to use. RCM also provides our team with real time alerts letting us know when someone has accessed the marketing materials.

Drone Videos have also been a great way to bridge the gap between antiquated marketing campaigns and innovation. Our team creates a video for every property we market and we make sure to utilize the newest trends in video editing and animation.

Tracking Metrics

Tracking the effectiveness of marketing campaigns is one of the most distinct benefits of leveraging technology for commercial real estate marketing campaigns. Metrics are essential to any marketing campaign because they show whether your marketing efforts resonate with your target audiences.​ This not only helps us make adjustments to current campaigns, it also helps us streamline future campaigns.

With every new campaign innovation there is a huge curve for learning. A wonderful example of this was our team figuring out the appropriate length for a property video. Metrics helped us find that most videos should be no longer than one minute and ten seconds. We learned an important behavioral pattern, specifically how much time our audience wants to spend watching a property video.

Not only are metrics important to us, they are important to our clients. And, technology allows us to accurately provide that information. Our clients want to know that we are correctly positioning their properties by showing them how many people watched the property video, how many people opened up an email from our marketing campaign, as well as how many people downloaded marketing materials throughout the campaign. These metrics provide valuable benchmarks and also help us re-assess a marketing campaign if the numbers just aren’t reaching our expectations.

Timing Is Everything

Timing really is everything with commercial real estate marketing campaigns and technology is a wonderful tool in helping our team find a campaign’s rhythm.

Because most of the platforms we use give us detailed metrics, we are able to see what time of the day works best for sending email campaigns, and even if a campaign is losing steam.

Technology goes hand in hand with all of our marketing campaigns and we are always looking for new ways to provide our clients with the highest quality possible and the most effective marketing campaigns.

ARGUS Enterprise: Warp Speed Ahead

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While change can sometimes be worrisome, ultimately, newer software models have proven to be helpful. For instance, can you imagine being stuck using Windows 2000 in today’s world and having data storage in MB rather than in GB or TB (as is the case of my external hard-drive)? Or imagine hiring a programmer who only knew C++.

The latest software upgrade to the ARGUS platform is entering into the repertoire of commercial real estate professionals, known as Enterprise. While many companies have been hesitant to switch over right away in favor of keeping the older DCF model, the latest announcement from ARGUS includes ending its support of DCF licenses on June 30, 2017. Also, since I began teaching the program at UCLA Extension in 2015, many universities including UCLA Extension have no longer provided instruction in DCF. Although ARGUS has stated it is “committed to working with [customers] to ensure a smooth transition” many professionals have been concerned about how this shift will impact the commercial real estate arena.

In order to help better prepare you for ARGUS Enterprise, here are a few key changes:.

User Interface

The first notable change is the user interface within Enterprise. The look and feel of Enterprise are meant to be intuitive for Microsoft Office users, with some semblance to Excel. Many of the entries, like in the Rent Roll tab, populate various rows, tabs, and drop-down options. You are also able to scroll and create multiple row entries. The language and terminology between DCF and Enterprise in many situations remain relatively unchanged; however, the method of entry provides more options, easier flow, especially for more complex modeling situations.

Reporting Options

In the DCF model a user can export the entire file into an excel document. With Enterprise, this feature has been modified. There are now many reporting options in Enterprise – more than even one user may even need, so the ability to export everything into Excel is a bit more difficult. Valuation Reports alone has eight options, and Tenant Reports has nine. Instead, you can export an individual report to an Excel or PDF file. Some users have the option of creating “Report Packages,” depending upon the license, which combines several different options together into a customized Excel or PDF file.

Complex Recovery Structures

While creating complex recovery structures isn’t new, Enterprise has made it a bit easier to see what exact expenses have been included into the expense pools, as well as if there are any detailed items such as administrative fees, or capped costs individually by the tenant.

IRR Matrix

One of my favorite updates to Enterprise is with the IRR Matrix table, found under Valuation Reports. After basic inputs are made, such as purchase price and entry and terminal cap rates, a user can easily see the IRR table for the analysis period and also make immediate adjustments if necessary.

File Exporting

Enterprise allows the ability to export the property file to a DCF file format, which is “.sf,” so even though you may be working off Enterprise, a group still using DCF can review your file. Keep in mind, however, that due to it being simply a different program, there may be variations in the cash flow and valuation results. A warning message will typically pop-up requiring the user to agree to this.

Automatic Saving

Unlike DCF, Enterprise doesn’t automatically save every change you make, which can be both a positive and a negative. One of the biggest complaints of the DCF format was trying to model different scenarios: you would have to save the original file separately. In Enterprise, you can make changes to the scenarios (such as changing the entry CAP Rate or Analysis Period) to see how this would affect the model, without having to keep the change if you didn’t want it hard-coded. This is a great way to see the updates in a live setting.

While migrating or changing to a new platform is never without trials or errors, many groups have already been making the switch or are at least easing into the new model. And, Enterprise has already made a variety of software updates. When I first started teaching at UCLA Extension, we used 10.0. The latest model version 11.6 was released in April 2017.

Of course, at Shopping Center Advisers we are here to help with your commercial real estate modeling needs and are equipped to handle any complex scenario using the latest and greatest technology.

Contact us here: http://shoppingcenteradvisers.com/contact/

Shopping Center Advisers | The Lagos Team | Getting Your Documents Ready for the 21st Century

Getting Your Documents Ready for the 21st Century

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Shopping Center Advisers | The Lagos Team | Getting Your Documents Ready for the 21st Century

The acquisition days of getting a large box of due diligence files are almost long gone, just as the days of the “floppy” drive and CDs. In fact, my own laptop no longer has a CD portal: our world is progressing rapidly to leverage technology platforms and Commercial Real Estate is no exception. Research has shown that digitizing documents saves both time and money. For instance, instead of wasting time looking for paper files and then spending money on mailing costs, you can find exactly what is needed and send them to the appropriate parties almost instantly.

And further, having key documents not readily available can actually hinder the transaction process and potentially delay escrow. If there is a missing lease file and the Buyer is coming to the end of his or her due diligence period, as an example, it is likely that there may be a request for an extension, or a potential re-trade if that missing file contains terms that can materially impact the economics of the deal.

A missing file can be easily avoided earlier on in the process with digitization. To help get your files ready for a property disposition, here are three key tips.

Document Scanning

Prior to positioning the property on the market, ensure all your files are not just collecting dust in a large storage unit or filing cabinet. There are many state-of-the-art scanners. Or, if you would rather have someone else perform the heavy lifting, document scanning companies can provide efficient services. A centralized storage system can decrease issues where files may be stored in different physical locations.

Sharing Files

Dropbox, Google Documents, and SharePoint are examples of free and low cost solutions that are user-friendly and accessible to anyone given the appropriate links and permissions. You can upload the files and send them to the Listing Broker or the receiving party within a matter of minutes. Even mailing a USB Drive is now considered a less efficient method of delivering materials. The benefit is truly accessibility. The files can be accessed anywhere at any time – even by a busy buyer while traveling away from the office.

Organization

Having a clear and concise method for organizing files is also helpful. Once the files are scanned, a system of creating folders such as “Leases” for all lease documents and “Reports” for all third party reports will enable searchers an easier time going through the documents. A concise method can also decrease the likelihood of confusing files or errors. Real Estate companies have often multiple properties and large amounts of documents that can become misfiled if not properly organized.

Avoid having a missing file delay your property from hitting the market, or causing escrow delays. And be sure to connect with your Shopping Center Advisers to help make file coordination as smooth as possible and get your property ready for the 21st Century.

Lagos Shopping Center Advisers can help make due diligence organization and coordination a smoother process, just get in touch with us.