Did you know it takes only 3 months to build a jumbo jet .. but in a recent study it takes on average 12.9 months to complete on office lease transaction from beginning to end. It took a man 7 months to cycle his way around the world … a complete industrial warehouse building can be built in less than 12 months.
Investors, brokers and tenants suffer immense cost and challenges from this slow pace yet the industry seems content with a pace and transaction speed from the 80’s. This has to change.
There are multiple factors that lead to this slow pace. Some we can improve and others are more difficult. For starters, roughly half of the process is out of he hands of brokers .. that is the architectural, permitting and construction process. But the other half of the process is squarely in the hands of the real estate brokerage profession and we have to do better.
If you sit back and think about the process that leads up to the execution of a lease agreement, for the most part it’s simply an exchange of information between owners, brokers and tenants. In today’s world with information at our fingertips and instant communication via email and shared web applications, this exchange of information should be much faster than the six months it currently takes.
Imagine a future where the exchange of building information, leasing proposals and counter proposals, financial analysis, lease drafting and negotiation all take place on a shared web based platform allowing for instantaneous access by all participants in the process, instant financial analysis, instant communication and faster decisions and responses. This type of share platform will carve months out of the leasing process.
Why should you care ? Depending on whether you are an owner, broker or tenant, the perspectives are slightly different but the benefits are generally the same:
- Do more deals
- Faster revenue collection
- Faster commission collection
- Lower cost per deal
- More time to focus on high value tasks such as relationship building, advising, new business development
- Lower admin and asset management costs
- Faster new location opening – faster growth
- Less time for deals to crater
And those are just a few.
At ProNet that is our vision. An industry platform allowing for instantaneous flow of information, instant analysis and faster decisions and shorter deal cycles.