Commercial real estate agents are some of the busiest people in the world. Like any commission-based sales job, they have to hustle every day to prospect new leads and close deals as quickly as possible. But, there is even more pressure on commercial agents than other sales roles because they also have to produce enough to pay for their overhead with the commission that they split with their broker. In most cases, the majority of this overhead comes not from office space or business cards but from the technology that they need to get their job done.
Technology has allowed today’s real estate agents to scale their business by doing a lot more with the same amount of time. If you think back to how hard it was finding new listings in daily hot sheets and how arduous it would have been to close deals with paper forms it is no surprise that agents are willing to pay for tech solutions. But, those solutions have multiplied and can easily add up. What is worse is that these costs are no longer voluntary as other hungry, tech-enabled brokers are competing for the same deals in every market in the country.
So what exactly do most brokers use for a tech stack and how much does it cost? Well, a recent examination done by brokerage solution platform Biproxi interviewed a number of commercial agents and found that they spend anywhere from $12,000 to $45,000 per year on the solutions that they need to make their daily workflow. One of the most common costs was a CoStar subscription which can go from a few hundred to over a thousand dollars a month depending on the market and subscription level (although I have heard that there is some room for negotiation). But that is just the start. Services like Docusign, local Realtor forms, Reonomy, Compstak, Crexi, Buildout and others all add to an agent’s digital overhead. Some admitted to not even knowing what their total spend was since it was an aggregate of so many different monthly bills.
The monetary costs of this growing list of digital tools is only the start. There are also the inefficiencies that come with not having all of your data together. The industry is starting to create more integrations of data between platforms but there is a long way to go before that can be considered anything close to seamless. In the meantime, busy agents are having to find ways to copy and paste their technology together, even if it comes in the form of time-consuming manual entry. I don’t know about you but one of my greatest frustrations is trying to even keep all of my log-ins straight. On my computer, it is a task. On someone else’s it is a research project.
There are some cases where tech platforms from outside of the real estate world can be brought in to help sort through this mess of applications, tools and recurring charges. Relatively simple automation aids like IFTTT or Zapier can be used to string together multiple different programs and streamline workflows. However, these applications require a clear understanding of a team’s work processes and tend to break down as soon as anything deviates from the pattern. Even worse, these services are only free to use for the most basic of tasks. Anything more in-depth adds yet another item to the broker’s tech budget.
Because no single company can deliver a turnkey product to streamline an organization’s workflow processes, the tech world relies on bundling. It is often looked at as a bad thing. As services get bundled, the bundlers are more at liberty to raise prices or include add-ons that aren’t applicable to every organization. But it doesn’t have to be that way. Bundled features or products can allow the core feature to subsidize development of “longtail” capabilities. It can also encourage experimentation and increase potential use-cases for a core product.
Adding services or products that complement one another can also be a way to gain market share, not necessarily just charge more. Commercial real estate marketplace Biproxi is an example of this. They have built out a robust set of tools, one that they think can rival most broker’s tools kits, to further their goal of creating a powerful free listing platform. The more they can offer brokers in order to improve workflows, the more listings they stand to attract to their platform. Remember, access to listings is likely the most expensive piece of any agent’s technology budget, so the right tech stack can save users, well, a bundle.