Bringing Innovation To Investment Appraisal

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Property research and valuation are now made easier with innovations in proptech Joining us today is James Shaw Co-founder and CRO of Edozo a company providing commercial real estate professionals the tools and technology they need to research and value commercial property more efficiently James discusses how we can harness the power of data to drive transformation in the industry He goes deep on the work they do to create an accurate picture of the market using multiple data sources and digital mapping He also gives his take on the future of real estate particularly as it relates to blockchain technology 00 01 – 04 28 Creating a Tool for Property Research James on how Edozo started their great team and supportive clients The solution they are offering in the industry Who are their end-users 04 29 – 16 53 Transformation Through Data and Digital Mapping Overcoming the challenges in collecting commercial real estate data How brokers can benefit from the technology What is the future of investment appraisal The mistakes people make with handling data Using contextual data How blockchain can go hand in hand with this technology 16 54 – 18 33 Closing Segment Reach out to James Links Below Final Words Tweetable Quotes We wanted to create software tools that help with efficiency and ultimately the liquidity of the commercial property sector – James Shaw I think one of the biggest challenges in the commercial property investment industry is getting access to up-to-date information because the markets are quite opaque when it comes to sharing that information James Shaw A mistake someone could make is to take everything that you get from all these different data sources and take it as verbatim So always always check and verify James Shaw —————————————————————————– Connect with James and know more about their services at Edozo com Connect with me I love helping others place money outside of traditional investments that both diversify a strategy and provide solid predictable returns Facebook LinkedIn Like subscribe and leave us a review on Apple Podcasts Spotify Google Podcasts or whatever platform you listen on Thank you for tuning in Email me sam brickeninvestmentgroup com Want to read the full show notes of the episode Check it out below 00 00 00 James Shaw I think the main mistakes people could make and you know a lot of these people are our clients So be careful what I say here Sam but look I think like any data from any provider in the market right 00 00 11 James Shaw It s always worth checking and verifying So a way we help our users to do so is we provide the agent s details Maybe that s the acquisition agent or the leasing agent So they can call them up and verify So we we do that We provide up-to-date information 00 00 38 Sam Wilson James Shaw is the co-founder and CRO of UK proptech Edozo a real estate technology company that combines digital mapping with property data with the tools needed to make research and valuation and commercial property easier quicker and more efficient James welcome to the show 00 00 53 James Shaw Thank you very much Sam It s an absolute pleasure to be on the show 00 00 57 Sam Wilson Hey man pleasure s mine There are three questions I ask every guest who comes in the show in 90 seconds or less can you tell me where did you start Where are you now And how did you get there 00 01 05 James Shaw So where do we start Well you know two of the three Edozo co-founders are chartered surveyors who worked in the commercial real estate industry So I was an investment agent selling office buildings and Andrew the other co-founder was a commercial property valuer We were frustrated with some of the software we used in our advisory roles and teamed up with Marcus an entrepreneur in the property space basically to create tools that make property research simpler faster and more accurate And in terms of where we are now so look over the last five or so years we ve got over 600 clients across the spectrum of the commercial real estate industry including the likes of JLL CBRE Avison Young Colliers International as well as the host of investors and developers and some lenders too 00 01 54 James Shaw We are a team of about 40 people based in the UK in London and expanding In terms of how we got here well I suppose a lot of hard work made mostly possible by building a brilliant team at Edozo across all disciplines and really supported clients especially in the early days who believed in what we were doing and wanted to go on a journey with us JLL for example was one of our first major clients in the early days They ve always been really forward-looking when it comes to technology and were instrumental in helping us to create our market-leading product 00 02 27 Sam Wilson What was it when you looked in the market you know and you guys were using other platforms and programs that were out there what was it that was missing that you guys said Hey this is something we can solve 00 02 36 James Shaw Yeah I suppose we were using the large legacy software providers It was quite clunky they were slow to innovate A lot of them had monopolies on the market for a very long time And therefore hadn t really pushed things forward There was also a wave of PropTech businesses starting in the early days And it created this time of innovation but really it came down to they were either too slow either didn t have all the data that we needed so slightly inaccurate And then the software was clunky and difficult to use And in an industry where you re having to appraise multiple assets at a time you know efficiency is a big thing And that s why I wanted to create software tools that help that efficiency and ultimately the liquidity of the commercial property sector 00 03 18 Sam Wilson Right And so who is let me let me ask this who is the end I know you said you guys work alongside of JLL and some of the bigger shops but you know who is the end user of your product Is it somebody on the back end of JLL that s in there you know taking your data and integrating with your mapping software Is it that the you know say me as a commercial real estate buyer am I seeing your product And then using it via JLL Like who is it that actually ends up interfacing with what it is that you guys do 00 03 46 James Shaw Yeah that s a great question Well it spans a whole number of disciplines within commercial estate So at its core in our core markets so the commercial property valuers or appraisers I think you call them in the US so super important part of who we provide services to then there s the brokers who are underwriting deals for their clients 00 04 03 James Shaw And then there s commercial investors as well you know acquisitions team and people looking at underwriting assets and finding assumptions for their investments appraisals So those those are the main people but then on our mapping side as well it might extend to teams that focus on building surveying and doing surveys of buildings that sort of thing So really we ve created a suite of products that covers quite a large section of the advisory but also more and more the investment community as well 00 04 28 Sam Wilson Certainly and combining that data with the mapping software I think would be where the you know the two kind of come together Is that right 00 04 36 James Shaw Yeah exactly Exactly You know and at the core of any commercial real estate research platform is a map And we essentially go about overlaying the relevant contextual data that s required to appraise investments So that includes for example the legal title boundary combined with some commercial property comparables 00 04 56 Sam Wilson What are some things that you guys I think we re surprised you know when you started putting this together and you started you know obviously bringing all this data together what were some surprising conclusions or maybe some things that you found as you started aggregating this data He said oh wow 00 05 10 Sam Wilson We didn t expect to find this but we did 00 05 12 James Shaw Yeah Okay Well look that s that s an interesting question And I think I think the main thing that we found was actually how disparate and how opaque the commercial real estate market is specifically in the UK where our focus is is that it s really difficult to find rent achieved and sale prices in commercial property unlike say the residential sector So when we started out on this journey we thought right we re going to go into the market collect the evidence and package it for our end users But you know the market doesn t want to share you know maybe for competitive reasons and so on 00 05 45 James Shaw So really it was figuring out a way to bring together multiple different data sources data match it and put it in our system just to ensure that that information is accurate And today I think one of the biggest challenges in the commercial property investment industry the brokerage side the advisory side is getting access to up-to-date information probably because the markets are quite opaque when it comes to sharing that information 00 06 11 Sam Wilson And other than going out and asking everybody individually Hey you know what are you getting you know per square foot on your office building or on your multifamily you know project how did you guys solve that problem If it is opaque it s opaque probably like you you know the reasons you mentioned How d you overcome that 00 06 27 James Shaw Yeah And look it s yeah it s a problem we re still solving but we ve got an excellent research team who does do a bit of asking and that ll always play a part But the amazing thing is is that so much of this data is being digitized now so we ve actually partnered with some commercial estate data partners And we ve also combined that with some of our client-contributed data as well So between these three prongs as it were we bring it all together and we can start matching the different data sets For example there s commercial land registry data in the UK So we can take the registered transaction amount from say the commercial land registry which which registered the government department that registered all land transacted in the UK 00 07 10 James Shaw And we use that as a starting point and can just layer on whatever else we ve got on the system from our data providers from our own research and so on So yeah it s an ongoing challenge but there s many more means to help us solve that now 00 07 24 Sam Wilson Right Right And then when you let s think about this from a broker s perspective like what were some of the problems may be that brokers had that you said Hey we can solve we can solve this problem and help you get whatever the problem was you know done more efficiently 00 07 37 James Shaw Yeah Well look we ll start with the sales brokers cause I used to be once So so look I think some of the changes I had similar to that that appraisers have right And it s just finding evidence to back up your assumptions You know you re advising a client and you ve got a great investment for them and you want to make sure that you put the right data into your appraisals of the value of that asset or maybe it s the future value 00 08 00 James Shaw And that could include rental transactions you know where you re positioning your your commercial rent or if there s any uplift in rent in the future And then also positioning your yield when it comes to bidding you know a couple of basis points here and there makes a big big impact on value and advising your clients properly around what they should be paying for an asset is usually important and easy access to information It really really helps that 00 08 25 Sam Wilson Yeah absolutely absolutely And so you guys have gone out you found ways to aggregate all of this data then build a mapping software that goes into where we can all see this or at least the users of your of your program can get in and see all this in one location and make a quick easy informed decision Where do you go What s the future of your business Like where where do you take it from here What s the next problem you re solving 00 08 48 James Shaw Sure The next problem we re solving is really just trying to get more insight for our end users from the data that we ve got So whilst at the moment you can see different comparables in the market 00 09 00 James Shaw We d love you to be able to bring those all together and start helping you to inform a value So we re never going to well I wouldn t say never but we re going on a long-term journey just to basically help people appraise and get to a value a bit quicker than they used to And part of that is aggregation And part of that is creating a level of automation in the process of researching and evaluating a property That will ultimately help you get to that value quicker So yeah in terms of the future where we are going a bit of aggregation of data better analytics and then ultimately where appraisers want to get to is an indication of value from from all of that as well That s automated by us for verified by the judgment of the broker lender or the commercial property investor 00 09 46 Sam Wilson Yeah that s something I hadn t thought about was the fact that lending institutions probably used your guys product as well 00 09 52 James Shaw Yeah they can do It s a market We are early in exploring now but there there is a lot of interest for that reason is that they underwrite loans for big commercial property investments and small and they need access to some of the information to sense check that the assumptions of whoever s applying for those loans so absolutely 00 10 11 Sam Wilson That s really really cool I love that Tell me some mistakes you feel like people are making right now in the data that they re pulling I ll leave that question open-ended but do you see people making mistakes in the data they re using And if so what are those mistakes and how should they be correcting it 00 10 26 James Shaw Yeah Well interesting question I think the main mistakes people could make and you know a lot of these people are our clients So be careful what I say here Sam but look I think like any data from any provider in the market right 00 10 40 James Shaw It s always worth checking and verifying So a way we help our users to do so is we provide the agent s details Maybe that s the acquisition agent or the leasing agent So they can call them up and verify So we we do that We provide up-to-date information but when you re using them for really you know really important transactions and advising clients We always advise look you know we aggregate it we put it all together It s still up ultimately up to the individual to make sure that they verified it for multiple sources So that could be a mistake someone could make is is take everything that you get from all these different data sources and take it as verbatim So always always check and verify is what I d say 00 11 20 Sam Wilson Are there really cool uses of data that you feel like people should be using it for and yet aren t Cause I know one of the things we ve talked about you know a lot here is having what you ve called an informed value So are there data sets that people you know could and should be using but they re just not in order to come up to what you ll call an informed value 00 11 41 James Shaw Yeah and and this is something we call contextual data So I ve spoken a lot about comparables lease and sale transactions but as we know there s so much more to property investments than just that And there s the surrounding area and the demographic surrounding that And there s also the surrounding occupies 00 11 58 James Shaw So we launched a product this year called the Edozo Occupiers And this essentially maps out all commercial occupiers in the UK That s retail industrial leisure office occupiers in a certain location Now you can do some pretty cool stuff with that in the future such as say you know you want to know how many gyms around because you want to put a gym in your building as a developer or investor and want to know what the competition might be in the area And so really starting to think think that way instead of just around The transaction evidence and how that informs what you do with your asset management strategy or your investment appraisal 00 12 33 Sam Wilson I like that a lot You called it Edozo Occupiers And what we re finding I m thinking I ve got my hand in the laundry facility business and so here in the states they will you can go to a lot of your larger equipment manufacturers and they ll go out and do those same sort of studies They ll tell you the demographic studies they ll tell you who s in the area you know how many of them are there But you got to piecemeal all this together from a variety of sources So it s not something Equipment manufacturer it s some from the local you know county GIS map some from you know just just basic Google search data and it s and it s all a little bit like you said contextual 00 13 08 Sam Wilson So finding a way in one in one location to put all that together would be you know really really cool I like the way you guys are thinking through how data really can be used and changed the way that we buy commercial real estate Tell me this There s a lot of talk around blockchain technology and you know how these transactions and things like this could eventually and again you know I think at this point a lot of it s just speculation but how that could disrupt commercial real estate Have you guys looked at that at all Any thoughts around blockchain and it pertaining to especially what you guys do on the data side 00 13 43 James Shaw Yeah so real estate and blockchains are really interesting really interesting topic And we don t implement any blockchain technology Intel technology now but we re definitely looking at it for the future I think where blockchain can help a lot in the short term is in basically improving the liquidity of an asset I think it takes a long time to register a property Well it does in the UK I ve heard in the US it can take a while as well And you know just in terms of contracts going back and forth from lawyers and advisors and so on And there s the contracting blockchain side then there s the registration of the property at the country s land registry facility So I think those two things contractual blockchain then you ve got the actual registration of it will go a long way to improve the liquidity Now in the future it would be great if there s an immutable record about the lease and the rent of that lease and so on that platforms like us and our advisors could use So I think you know it has the potential to change the industry There s nothing that s really doing so yet but those two opportunities in the contract side of the property as well as the registration side can really speed things up and ultimately improve liquidity and maximize returns to your investors and shareholders 00 14 56 Sam Wilson Yeah that s for sure And on some of those fronts I hate to say it but some of the lack of transparency is good for us as real estate investors in the sense that we don t necessarily want it to know down to the penny what people are paying per square foot for rent within a you know one tens of a mile radius on a retail strip center I may own right I don t necessarily want that cause I ve come to an agreement with my local tenants and then that s our agreement and suddenly you know they re they re shaking this paper at me saying Hey man like you know look you re way more expensive Now everybody else have to rework this lease you know 00 15 28 Sam Wilson So in some regards I m like man I don t really like that But then I think about it in other terms of you know for us we call them the register of deeds I mean it s horrible I mean there s there are so many counties and so many places here in the United States that aren t even online yet Like you can t even you can t search the records without driving to the courthouse and actually looking through courthouse records It s like this is we re operating in 1875 Like this needs to be you know brought up actually search the records in a meaningful way 00 15 58 James Shaw I do think in real estate that s where blockchain can have its have a really big impact is speeding on that deed registration the paperwork and so on in a transaction And there s some great stuff happening here in the UK around that But there s a long way to go It ll take some time to be to be more widely adopted 00 16 16 Sam Wilson It certainly will And and in typical bureaucratic fashion there s going to be a lot of people standing in the way of that I m thinking specifically of the people who work in the register of deeds office the register of deeds people themselves And then of course all of your title companies that sell and make a lot of money on title insurance aren t going to necessarily be in favor like you called it in immutable record where all of us could just go oh yeah of course James owns that and he s owned it for 50 years and sure he can sell it and I don t need title insurance anymore 00 16 43 Sam Wilson So I think we re going to have you know like I said in typical progressive fashion people standing in the way of trying to make things simpler and easier but you know that progress will come either way So this is really cool James I love what you guys are doing I love how you ve seen opportunity in the marketplace and you know created a product that probably so many of us on a regular everyday basis used and maybe not even know that you guys are the people behind it making it happen So I certainly appreciate what you guys do I love it Are there any other closing thoughts that you have as it pertains to your business data mapping software integrations things like that that you d love to share with our listeners before we sign off 00 17 20 James Shaw So first of all thank you so much Sam for having me on and asking brilliant questions Look nothing nothing more from me at this stage about us You know if you if you re interested and about learning more about our system and if you re UK based and need access to better research data please check us out at edozo com 00 17 36 Sam Wilson Awesome One last and final question for you here James And if this question does not work we can just cut it out But if so we ll leave it right in When are you guys coming into the States 00 17 45 James Shaw Ah look well there s the Pretech New York CREtech New York event coming up later this year that we re thinking of attending We don t have plans immediately to come to the States but yeah we ve still got a long long long road ahead of us and it s definitely one of the markets we re looking at So so you never know you never know 00 18 02 Sam Wilson I love it James thank you for your time Certainly appreciate it Have a great rest of your day 00 18 06 James Shaw Thanks so much 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