Today I sit down with Simon from Commercial Property Guide and talk about why he created a commercial property site when there are such large competitors in this space.
Hey guys, this is Ryan here from onproperty.com.au, your daily dose of property education and inspiration. And today, I’ve got with me Simon, who’s the CEO of commercialpropertyguide.com.au.
Ryan: Hey, Simon. Thanks for coming on today.
Simon: Thanks, Ryan. It’s nice to be here.
Ryan: So, today, we’re going to be talking about a bit about your story and the story behind commercialpropertyguide.com.au. Why you started it? How it’s been going? So, do you want to take us back to the beginning? What opportunity did you see and why did you start Commercial Property Guide?
Simon: Sure. My background was obviously, I’ve been in the dot com space since sort of late 90’s. I was with carsales.com.au for a long time. So, I left there about 2006 and thought there was a space for, basically, transferring into a media agency that I wanted to begin. I began Rose eMedia about 8 years ago and then, sort of, as time went on built customers within the car industry and also fell into the property market. We then looked at the Commercial Property Guide as a CRM system. We built a prospect and listing management system for our commercial property agents nationally. And that, obviously, in turn, not only do we have the CRM system for these guys but we built listings in our back-end database. And, obviously, hearing around the traps about the market, what the competitors were doing. We believe there was a gap and, you know, we’ve got larger competitors. We weren’t trying to sort of take that one in the beginning – and at all now – but we believe then and still believe that there’s gap in the market and we wanted to fill it.
Ryan: Really, you started as a CRM system, which is a customer relationship manager. So, that’s like a back-end system for the real estate agents who are listing these properties, is that correct?
Ryan: So you started like that and then you saw an opportunity to go from being just a CRM system to being a consumer-facing website.
Simon: Correct, yeah. And we thought we’d had our work upstart so with the amount of listings that we based on the customers that we had and the feedback we were getting from the agents about the competitors in the space, we thought, you know, we can do this. We had a great technology team; we had a great development team, design team and a good sales team. And we decided to launch it. And, obviously, any competition is good for any market and then, obviously, agents have sort of jumped on board. Without the agents, without the listing and the content, you’re nothing. So, over the last 2 or 3 years we’ve been growing the content vast. And now, in turn, with the content, comes the leads and the traffic and the inquiry for the agents as well as the advise for the consumer.
Ryan: So, your growth has really been on the side by providing helpful content to people around commercial property. You’ve really got a lot of interest from that which, obviously, drives people towards the property listings that you’re putting on your website. And you were telling me about some of the growth statistics that you’ve had over the last couple of months. Do you want to go through them again?
Simon: Yes, sure. I mean, we found investment searches have grown about 10% every month over the past about 18 months. Approximately, it was 5% of all of our sales searches are for list investments across the eastern seaboard, predominantly Brisbane, Melbourne, Sydney. The beginning of a financial year is generally where we see our big spikes with our investment searches. I think last year, we had from June to July 2014, we had 97% increase of our investment inquiry searches. So, there’s trends there and, obviously, we’re finding that the more listings we get on – and now that we’ve got most critical massive listings all across the country – we’re finding that we get a good amount of inquiry. And now, obviously, I’m just starting to see the results coming through now.
Ryan: Yeah. And, obviously, in that type of industry, those sorts of things compounds. So the more interest that you have in a website, the more consumers coming there, the more people want to list there and, you know, it’s a situation that, I guess, I never really wanted to be in my business ’cause you need to balance both sides which obviously makes a business a bit harder. But it seems like you’re managing that and you’re growing. So, in terms of Commercial Property Guide, where do you see going in the future? What can we expect to see?
Simon: Sure. Again, our main objective is to become a news and advisory for the consumers about commercial property. We don’t want to be just a portal that is drawing up listings and where you go find it. We want to guide you through the process. A lot of people wouldn’t look for a commercial property if they’re opening a retail shop or an office every year or every 4 years. We want to guide you through and give you our experience on how to do that easily and effectively.
Ryan: Yeah. It sounds like you are a bagful of knowledge from the interview that we did previously, talking about the differences. You guys understand a lot over there and there are a lot of subtle differences between commercial and residential properties and I think there’s definitely a massive need in the market for content that explains, in layman’s terms, exactly what the types of investments are? Or if you’re trying to lease one of these investments, how do you go about that? So, I think we need more people in this space and more people sharing their wealth of knowledge about all of this sort of stuff. If you could give a tip to people, your number 1 tip or a couple of tips on investing in commercial real estate or looking at commercial real estate. What do you think that would be?
Simon: That’s an interesting question. I think, definitely research. Obviously, looking at the area and looking what types of businesses are in the area that you are looking at. Check out if it’s a retail or office. Check out other businesses that are in that building or around you. And, obviously, see the amount of activity, I suppose, is the main thing. For me, personally, I’d want to be confident that if I owned a property in this space, I would have every confidence that if someone saw it, being in the area that I was in, that they’d want to lease it if the price is right.
Ryan: Yeah. So it’s about doing your research and being in the right area.
Simon: Yeah. Absolutely. And starting off small. I mean, at the same time, you know, making sure that you can cope with untenanted office space or whatever the investment is. And making sure you’re not being clawed out because, yes, it sounds great by having a tenant that can pay the mortgage off. But if you don’t have a tenant and can’t afford it, you’re going to put yourself backwards.
Ryan: Yeah. So just make sure that you’re in the financial position in order to do it and that you don’t over-extend yourself in case you do have longer vacancy periods than expected.
Ryan: Yep. Awesome! Okay. Well, I look forward to following you. I’m actually going to spend some time over at commercialpropertyguide.com.au and check out your content because now that we’ve discussed investing in commercial property and the benefits and the cash flow that you can get from that, it’s definitely something that I want to explore in more detail. And guys, if you want to learn more about investing in commercial property, head over to commercialpropertyguide.com.au and you can learn from Simon and his team over there.
Thank you so much, Simon, for coming on.
Simon: Thanks again.
Ryan: I’ll talk to you soon.
Simon: No worries. Thanks, Ryan. Cheers!