An estimated $6 billion is spent globally on advertising commercial property, with $100 million in Australia alone exhausted on outdated models of advertising. A significant amount of resources is wasted by owners and real estate agents whose ads do not perform to the level expected.
Technology development in the real estate category until recently was primarily focused on residential listings, with the standard for online commercial property ads has been set by a duopoly who have retro-fitted residential real estate search engines to create commercial search engines. These agencies display office leasing ads similar to those in the classified newspaper section, with minimal details and simple text, charging on a pay per ad basis. Additionally, the classified newspaper ad model shuts out a lot of office stock that is too small to justify the cost per ad model. These ads are rather bland and offer no added value, specs or insights into the estates.
Opportunity for the industry to use new technological innovations is enormous, and with the increasing development and commercialisation of virtual reality, various companies are finding that now is the best time to disrupt the marketplace. With the immersion of VR, highly visualised data and virtual spaces can bring back the focus on customer experience and engagement with real estate, both residential and commercial.
Sydney startup JAGONAL is looking to usher in the next generation of office space search engines. The startup helps people find the perfect office space for rent or sale through 3D virtual tours, offering a view from every window that is enhanced with a Google street view-style of visuals. The 3D is generated through building data used to create online stack plans, with the stack plan showing which floor a vacancy is on, and the rent for each specific floor.
The search engine offers three alternative ways to find a specific office space. The first option allows users to select from a checklist that covers a range of criteria. The second option enables the user to use a text box search to enter a range of search choices; for example an agent can search ‘budget office in Sydney for 5 people’ or ‘office on Pitt Street.’ Option three is increasingly popular with overseas investors, allowing users to click on the 3D model of a city in Australia to view a display of vacancies. Users search for any building and can see a view from any office window in the CBD.
The search engine has a catalogue of over 4,000 buildings with more than 50 searchable features including building grade, street location, office layout, bike racks, and views.
Cofounder Andrew Brown said that his team has developed a product that allows owners and real estate agents to lease future office vacancies up to two years in advance to reduce vacancy rates.
Brown and cofounders Max Sim and Serge Kotlyarov worked together at REA group, the global online real estate advertising company. After every production meeting asked themselves, ‘what do we do for commercial sites?’ Brown explained that commercial sites were never a priority, as residential real estate advertisement was bringing in 93 percent of the revenue. However, on the other side, real estate agents were always complaining about the portal.
“We knew there was a better way but we did not come up with the full solution until many years later. It all came together when Serge and I exited our respective startups. I had left REA to build a real estate CRM and Serge had left a fintech startup, which he left after finishing his MBA at London Business School. The time was right for a new startup in an industry which we really understood,” explained Brown.
The idea for JAGONAL was the culmination of various ideas that they thought could improve the industry. As well as the VR aspect, the team introduced a new ad model that scales based on the size of the office being advertised, making it affordable for owners of small offices as well as large. The platform also offers owners and agents unlimited subdivisions/splits of office space, for instance a 1000 sqm office space can be split into two 500 sqm offices at different rents. This offer showcases the deals the owner is willing to consider for the office space.
In terms of reaching out to the market JAGONAL publishes a daily commercial property newsletter, a tool the company uses to build upon the relationship with owners and real estate agents in the industry.
“In terms of reaching tenants, SEO is a major channel for us. We focus a lot on new user acquisition through Google and we have been growing rapidly due to the depth of information on offices we provide. We are seeing weekly growth in Google SEO placements,” said Brown.
Virtual tours of spaces, events and building are fast pushing the real estate, tourism and hospitality industry into the future. 3D models and technology that harnesses augmented reality are taking the next step into customer experience, allowing consumers to engage with products and spaces on a level that has never before been reached.
Leading market innovator iVvy is also testing out VR tech, stepping up its game when it comes to customer engagement. iVvy recently gave organisers the ability to experience 360 degree 3D tours of floor plans for venues on its marketplace. The 3D tool ensures less time is spent on planning site visits, enabling staff to focus on delivering great experiences to incoming leads and customers.
Lauren Hall, CEO of iVvy, said, “This feature brings planners closer to hospitality brands, but also saves the industry a significant amount of time and money in an area no one else has in the past.”
iVvy works in partnership with Scann3d and events agency EMG to bring in virtual tool elements to the marketplace and, like JAGONAL, it has seen recent growth in the industry.
“As we expand globally, the hospitality industry can now take their offering to customers anywhere in the world. In the age of connectivity, we are giving people the ability to make decisions about venues from any location, knowing that it is just as good as if they were on-site. This is the future of events and hospitality and we are proud to be catalysts of the change,” said Hall.
News Corp too has been integrating VR technology into its various media offerings. Realestate.com.au is by far the most prominent company within News Corp that is currently experimenting with VR in ways that are sure to disrupt the industry. Forget about touring Google street view to gauge the overall look, style and feel of a property, Realestate.com.au has created a completely immersive experience, equipped with visuals and sounds that transport consumers to a virtual representation of property spaces. This representation tricks a consumer’s sensory perception, making them believe their surroundings are real. The only things you can’t do is feel or taste, but the heightened visual experience is immersive enough to engage with spaces that are for rent or sale and help customers to make an accurate assessment of whether or not the space is suitable for them.
With that in mind it will be interesting to see how JAGONAL explores other options of immersive and VR experiences. It is crucial to keep innovating in this sector as News Corp has acknowledged that the marketplace is ripe for disruption and is continually disrupting their own services to stay ahead of the game.
JAGONAL launched in beta last April, and is set to officially launch this month. Currently the startup lists office spaces across Australia and in the near future is planning to expand into Singapore and other similar markets.
The startup has raised $2.45 million in funding to date, and is looking to raise a further round to bring it to the $6 million mark and help fund international expansion.
Brown said, “The next 12 months will be about investing heavily in marketing, refining the product and replicating our success in Singapore and other markets.”
Image: Max Sim, Serge Kotlyarov and Andrew Brown. Source: Supplied