April 18, 2016
True to tradition, managers still rely on spreadsheets and PDFs to run their assets. However an explosion of tech startups wants to disrupt old systems, raising $1.5B in ’15 alone.
We sat down with the CEO of one of these tech firms, Hightower’s Brandon Weber, for his take on the commercial real estate tech boom and the implications of the use of big data in the real estate space.
Bisnow: You’re part of the recent boom in real estate tech. Why are so many tech firms popping up right now?
Brandon Weber: The boom is a direct result of the growing gap between where commercial real estate as an industry is at in terms of using tech to power its business, and where the rest of the world is.
Over the last two or three years a number of tech companies have this unique DNA of tech and commercial real estate experience—people who have experienced that gap in the industry and have the ability to address those problems.
As a result you have companies delivering value to an industry that essentially hasn’t seen any innovation in the last 15 to 20 years. So that’s created this gold rush of commercial real estate tech companies.
Bisnow: So what led you to found Hightower?
Brandon Weber: The real catalyst for Hightower was that I represented the largest, most sophisticated institutional owners in my market in Seattle. These are global asset managers with billions in AUM, and they were using the exact same toolset, process and analytics as an owner who had one 50k SF building—there was no difference in sophistication. The result is that you had very smart people wasting so much time trying to get their jobs done.
Bisnow: What is Hightower exactly—give me the breakdown?
Brandon Weber: We’ve effectively invented a new category of software, that 24 months ago didn’t really exist. Hightower is a cloud and mobile leasing and asset management platform that connects all of the people in the real estate process: property managers, brokers, asset managers.
It also connects all the data—inventory, deals in the pipeline, financial analysis, current tenants, all into a single dashboard platform. When Vornado, Shorenstein, Invesco rolled out Hightower it essentially became their system of record for their business.
Bisnow: Looking back at the market as a whole, why is this commercial real estate tech boom just happening now? Why not earlier? What caused the delay in adoption?
Brandon Weber: The “why now” answer is two things. One is that the tech has reached a point where there’s just such a transformative impact you can make by bringing mobility, data analytics and big data together. The catalyst has been founders who both understand the industry and understand how to build technology. Which is a Venn Diagram that has had no overlap for a long time. I’m probably one of the better examples of that—I have a degree in computer science, built software at Microsoft and also spent six years at CBRE as a leasing broker.
Bisnow: Tech is often consumer-driven, or driven by smaller users—but it sounds like Hightower’s growth is mainly through larger companies.
Brandon Weber: Yes, I would say the driving customer forces are major institutional owners and the major brokerage firms. We have partnerships with all of the major brokerage firms and are working with them to deploy the platform.
Bisnow: And they revamp their whole system when they adopt Hightower?
Brandon Weber: Yeah, they take their whole leasing business, which was tracked in thousands of spreadsheets, documents, network drive folders, and we move it into a single centralized platform.
Bisnow: Is that a difficult switch to make?
Brandon Weber: Great question. It’s one of the biggest things we spend time with. The Hightower onboarding team manages putting all of that spreadsheet data into our system, so clients don’t have to deal with it themselves.
Bisnow: You guys are collecting a lot of data through your platform—is there a potential for “big data” analysis of all of this info?
Brandon Weber: Yeah, we’re moving to a world where Hightower is going to help our clients play “Moneyball” in commercial real estate—really analyze the data to pull insights that might be totally novel and not visible by other means. When you think about our vision, we say let’s first of all get the tools in place that will let people get their jobs done more efficiently.
As an outcome of doing that we’re helping you structure and aggregate all of the most important data about your business, and then we’re helping you analyze and pull insights out of that data to helping you make better leasing decisions, buy/sell decisions and asset management decisions.
Bisnow: So is Hightower developing software on top of your current platform to add a greater data analysis component?
Brandon Weber: We’ve got some really exciting things that are going to be coming out in this quarter or next quarter that I’ll share with you guys. We should stay in touch on that.