Convergence is coming. We hear about it in a variety of industries and circumstances and it’s coming to commercial real estate.
We’ve continued to evolve our vision on where we think both SquareFoot and the commercial real estate market should be headed in the next few years. One of the things that I think is very interesting is the notion of a vertically integrated real estate company. And not vertically integrated in the sense that we usually speak about in commercial real estate.
In a nutshell, the notion of a company that’s built on this simple algebra equation:
(Landlord+Brokerage+Flexible Space) * Tech.
The company would provide the full suite of solutions for occupants, including the space itself: that starts with space selection (brokerage), then getting the space ready for use (project management/construction/ffe), then products and services for occupancy, which then leads back into the tenant’s next space search. This could all be done both in-house (for company owned properties) as well as on a third party basis.
WeWork would be the best example of this to date however I think there is still plenty of work to do there. And while they have a very nice business and a valuation people can’t fall over themselves fast enough to opine on, it’s still just a drop in the bucket when one looks at the overall size of the commercial real estate landscape.