What is Third Party Logistics (3PL or TPL)?

Third party logistics also known as 3PL  or TPL is when a company uses a third party business to outsource parts of the company’s fulfillment & distribution services, rather than secure their own industrial space for rent.

Third party logistics service providers commonly specialize integrated operations, transportation, and warehousing services that can be customized and scaled to a customers needs. For example when the delivery service requirements & demands for materials and products increase for an Ecommerce business. These 3PL services often go beyond logistics and may include value added services that relate to the procurement and production of goods. For example services integrated in portions of the supply chain. When integration occurs at this level the provider is now called a third party supply chain management provider (aka 3PSCM). 

Who Uses 3PL Services?

3PL services are used by over 80% of all Fortune 500 companies and over 95% of all Fortune 100 companies. Globally the third party logistics market is over $750 billion. In the U.S. the 3PL market is around $150 billion and growing at about 7% per year.

Types of Third Party Logistics Companie

Third party logistics companies can be any company offering and integrating subcontracted logistics & transportation services as well as freight forwarders and courier companies.

• Standard 3PL – They offer the most basic logistics functions such as warehousing, pick & pack, and distribution
• Service developer – Offer value add services in addition to basic services such as cross docking, tracking & tracing, packaging, security
• Customer adapter – Basically takes over a company’s logistic activities however does not create a new service. Customer base is typically small.
• Customer developer – Highest level of 3PL services. The logistics provider integrates with customer and takes over entire logistic activities.

Should You Hire a 3rd Party Logistics Provider?

There are certain logistics that you can probably do better and cheaper than an external 3PL however it’s beneficial to do a cost vs time analysis to determine what is right for your business. If you have the time, money, personnel, expertise, etc to lease warehouse space then take care of your own logistics. However if your core business is retail or ecommerce and you don’t want the hassle of renting warehouse space, committing to long term lease contracts, hiring and managing people, or having the additional overhead then consider evaluating a third party logistics company.

The nice thing about outsourcing is that if your company ever needs to expand or contract you don’t have to worry about finding more warehouse space. You can simply tell your logistics company that you need more or less space. In most cases when leasing warehouse space you will have to sign a 3 to 5 year lease. 3PL contracts are typically much shorter than that so you have a lot more flexibility and not have to lock in long term commitments. 

What is a Tenant Estoppel Certificate in a Commercial Real Estate Lease?

From time to time a commercial real estate property with tenants will be sold or refinanced. During the due diligence phase of the acquisition or during loan underwriting the landlord or lender will send a written request to all the tenants asking for written verification that their lease is in full force and effect and confirming the rent amounts being paid. This written statement is called an estoppel certificate. 

You will typically see estoppel certificate language in the commercial lease contract. This is not typically a negotiable item when negotiating commercial real estate spaces for lease. The property owner’s lender will require it because it provided proof of cash flow, which is what the lender or potential investor (aka purchaser) is concerned with.

From a tenant perspective there is really nothing to worry about. Having it in the lease does not impact you as a tenant. They only time the landlord will ask for this is when the property is being sold or refinanced.

Definition of Estoppel Certificate

By definition an estoppel certificate is a certified written statement signed by a party certifying for another party that certain facts for true. The delivery of this statement stops that party from claiming different facts later on. 

What Will The Estoppel Letter Include?

The tenant estoppel letter will vary. Depends on the landlord and/or landlord’s attorney. However below is the information they will typically need:

• Lease commencement date
• Dates that rents are paid
• Confirmation that there are no defaults by tenant or landlord
• If there are defaults then info of details and resolutions will be needed
• Confirmation that the lease has not been modified and in full force and effect
• If the commercial lease has been modified then need verification of modifications

Example Estoppel Certificate Language

Below is an example of the language you would see in a commercial lease contract regarding estoppel certificates.

Tenant shall from time to time, upon written request by Landlord or Lender, deliver to Landlord or Lender, within ten (10) days after receipt of such request, a statement in writing certifying: (i) that this Lease is unmodified and in full force and effect (or if there have been modifications, identifying such modifications and certifying that the Lease, as modified, is in full force and effect); (ii) the dates to which Rent has been paid; (iii) that Landlord is not in default under any provision of this Lease (or if Landlord is in default, specifying each such default); (iv) the address to which notices to Tenant shall be sent, and (v) such other matters as may be reasonably requested by Landlord; it being understood that any such statement so delivered may be relied upon in connection with any lease, mortgage or transfer. 

Tenant’s failure to deliver such statement within such time shall be conclusive to Tenant that: (i) this Lease is in full force and effect and not modified except as Landlord may represent; (ii) not more than one month’s Rent has been paid in advance; (iii) there are no defaults by Landlord; and (iv) notices to Tenant shall be sent to Tenant’s Address as set forth in Article I of this Lease. Notwithstanding the presumptions of this Article, Tenant shall not be relieved of its obligation to deliver said statement.

Geek Estate Mastermind Newsletter #35 – Car Buying, and the VIP Buyer/Seller Real Estate Experience

The topic of Geek Estate Mastermind Newsletter #35 was Car Buying, and the VIP Buyer/Seller Real Estate Experience. For the first time since 2012, I’m a car owner again. I shared some observations from the car buying process, and added a real estate lens to the topic. At the end of the day, I believe the future of the real estate industry will revolve around delivering an unparalleled VIP experience. That’s the best, and only, differentiator there is against consumers choosing a friend or family member.

A few of the curated articles referenced:

Leica Geosystems and Frank Lloyd Wright Foundation Team Up to Transform Taliesin West into an Immersive Online 3D Experience in Business Wire. Taliesin West is one of the most famous historic properties in the United States. HGTV has seemingly proved there is unlimited demand for seeing cool houses. I believe there’s an immense opportunity to drive consumer engagement with historical and unique architecture.

Travel brands need to rethink “local” if they want to engage customers in Tnooz. “Local” is, of course, a topic the real estate industry thinks about constantly. How do you showcase neighborhood schools, businesses, and amenities in an authentic way? It’s worth reading how the travel industry thinks about the topic of local, if for no other reason than it’ll make you realize local is a constantly moving target.

Here’s What The New Piccadilly Line Trains Will Look Like in Londonist. I’m always interested to learn more about the modernization of transit systems, and the £1.5bn contract will serve as an example other cities will surely follow.

As a reminder, the purpose of the Geek Estate Mastermind is two fold:

1. Curate the world’s most innovative and diverse community of real estate creatives, doers, and pioneers.
2. Make our members wildly successful in their careers building real estate companies.

If you want to read the entire newsletter, and future weekly editions, please apply for a Mastermind membership below.

Apply for Membership

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Meet the Real Estate Tech Founder: Tyler Forte from Felix Homes

In our latest real estate tech entrepreneur interview, we’re speaking with Tyler Forte from Felix Homes.

Without further ado…

What do you do?

I’m the CEO and Co-Founder of Felix Homes. We’re based in New York City and will be launching in Nashville, Tennessee within the next two weeks!

At Felix we don’t want to be your agent, we want to be your home selling partner. Felix is the only platform that combines key benefits of the direct buyer model with advantages that stem from working with a traditional real estate agent. We give owners the certainty of a guaranteed sale, an upfront cash payment to help with expenses and an incentive structure that gets them the highest price.

I was motivated to start Felix Homes after experiencing how broken the current selling process is and hearing other ‘horror stories’ from friends and family. I started Felix to help reduce the stress of selling a home by creating the most consumer friendly model.

My day-to-day role includes managing the launch of our Nashville operations, as well as working with my team to ensure we’re effectively getting our value proposition in front of consumers so that we can help as many home sellers as possible.

What problem does your product/service solve?

Our basic premise is that home sellers are not compensated for the uncertainty that stems from selling their home. Prior to Felix, owners had two options, working with a traditional agent and hoping that their home will sell or working with a direct buyer and paying a commission fee that’s as high as 12%.

At Felix, we pay homeowners up to 2% of their home’s value just for listing on our platform. If Felix is unable to find a buyer within 90 days, we’ll purchase the home at an agreed upon price, so the seller can have the certainty of a guaranteed sale from day one. Instead of taking a traditional 5-6% commission, we’ll list your home at market value and if we can sell it for more, we earn the difference capped at six percent. This means that we only make money when the home seller does.

What are you most excited about right now?

We’re really excited about our launch in the Nashville market! We’ve talked to sellers, buyers, and brokers in market and all of them were enthusiastic about our product offering. In fact, based on a customer survey we conducted, over 73% of respondents would either use or recommend Felix over a traditional agent.

Additionally, it’s great to see the amount of innovation in prop-tech and the growing acceptance of new, disruptive models.

What’s next for you?

Our goal is to launch and scale in the Nashville market and then expand nationwide. We’ll be raising additional capital come Q4 with the intent of using the financing to expand our offerings to other markets.

What’s a cause you’re passionate about and why?

I’m passionate about social equality. My two co-founders are both immigrants and I believe the current environment really discounts the amazing talent and varying perspectives that made America great. I think we should be more open to people from all over the world and should work on attracting the best talent to the United States.

Thanks to Tyler for sharing his story. If you’d like to connect, find him on LinkedIn here.

We’re constantly looking for great real estate tech entrepreneurs to feature. If that’s you, please read this post — then drop me a line (drew @ geekestatelabs dot com).

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from theokbrowne digest https://geekestateblog.com/meet-the-real-estate-tech-founder-tyler-forte-from-felix-homes/

Places’ Lack of Value Proposition

Places, a new social network, got written up in Inman. Have a look at their home page:

Notice anything?

I did. There is no primary value proposition. What problem would I use this product to alleviate, and why? I’m left wondering on both questions.

Was this a premature product launch? I’d say so.

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from theokbrowne digest https://geekestateblog.com/places-lack-of-value-proposition/

A New Category King Emerges in Marketing Automation, and a Founding Member Interview

I’ve written about category kings before: it’s what every startup should be striving for.

There’s one unquestioned “Category King” in real estate. Among real estate portals (in the US), the clear, runaway king is Zillow Group.

There will be “Category Kings” of various segments of the industry, and I think we’re seeing one of them emerge.

Imprev, in marketing automation.

The Imprev platform already powers the marketing centers for hundreds of brokerages and franchises—representing over 20% of real estate agents in North America—including RE/MAX, Coldwell Banker, Berkshire Hathaway Home Services, Corcoran Group, NextHome, Realty World, and Hunt Real Estate, as well as Homes.com and MRIS.

You may have seen the recent Imprev partnership with NextHome, a real estate franchise with 290 offices and over 2,400 agents. The company also owns the Realty World Northern California & Northern Nevada franchise networks, collectively controlling over 400 offices and more than 3,000 agents. The company closes over 14,000 transactions annually worth over $4.6B in volume, and is more often than not one of the companies in contention when brokers/agents are considering a change of brokerage (see here).

In the press release, James Dwiggins, the NextHome CEO, says “We’re Raising the Bar in Real Estate Marketing”. That obviously implies that Imprev’s platform is helping facilitating that. To me, the Nexthome deal marks a major notch in Imprev’s quest toward domination of marketing automation in the real estate industry. We’re at the point

Founded in 2001, Imprev is an example of a company that remains in the slow and steady wins the race camp. That’s my type of business. They aren’t flashy. They don’t overpromise. They don’t care if they are on stage. They plug away with improving their product and increasing their sales one day at a time. Every single day, month after month. Year after year.

Congratulations, Imprev. Welcome to the throne as the category king for marketing automation in the real estate vertical.

I’ve known their CEO, Renwick Congdon, for a number of years (see his meet the RE tech entrepreneur interview from last year). He’s a class act. We’re fortunate to have him as a founding member of the Geek Estate Mastermind. I had the pleasure to ask him a few questions to dig more into their recent work and where he sees the industry heading.

What’s Your most significant business focus for 2018?

Helping brokerages and franchises build stronger relationships with their agents through marketing automation. Marketing automation helps the broker act as a “marketing guide” for their agents and systematizes best practices to make everyone more successful. This is a key service where the broker can offer tangible value to their agents. For example, marketing a luxury home in Los Angeles requires different steps and workflows than a starter home in Indiana. The broker has the benefit of looking at all the company’s listings and pinpointing trends, successes, and failures, then using that knowledge to automatically recommend the next best steps to not only market a new listing, but to use that marketing to generate more business. That type of support is powerful!

When did you originally realize marketing automation was where the company would make its mark, and what’s been the hardest part of fulfilling your vision?

Since 1992 when I wrote my first marketing software program—before I started Imprev—I’ve had the vision of handing real estate agents all the marketing materials they need to promote a listing and their business. The hardest part has been waiting for technology to catch up. When I started Imprev in 2000, our technology was able to deliver functionality that few other companies could match. Agents could create all their materials, from flyers to flash multi-media, within a very easy user interface, and they had access to hundreds of professionally-designed templates.

In 2015 we felt the technology to create all the design work for agents automatically was ready for scale. We launched our first client on automation, Berkshire Hathaway HomeServices Fox & Roach, REALTORS®, and haven’t slowed down since. Today we have 212,000 agents experiencing marketing automation and are generating millions of pieces of marketing across print, digital, social and video.

What’s next for marketing automation?

Continuing to help brokerages and agents generate more business from the listings they already have on a larger scale. Opportunities include leveraging the vast amounts of data out there to automate hyperlocal marketing for agents. I find that idea really interesting. The portals have a tight grip on the consumer right now; how can we change that and give some of the power back to brokerages? I believe that automation—used correctly—will bring agents and brokers closer to the consumer. Every day we’re expanding the scale of what automation can handle.

What real estate technology trend or product are you most excited about?

Artificial intelligence. I see AI as telling the computer the rules, and letting it figure out the options, versus machine learning, which just shows the computer a bunch of experiences that it can choose from.

What do you like about being a Geek Estate Mastermind member?

Connecting with really smart people about cutting-edge topics. Drew brings up subjects that are so far advanced; it’s a great reminder to keep an eye on the future and make sure we’re prepared for the next big thing.

Geek Estate Mastermind

Apply for Membership

[Graphic via https://www.colourbox.com]

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from theokbrowne digest https://geekestateblog.com/category-kings-marketing-automation-and-a-founding-mastermind-member-interview/

Blockchain Ledger Technology and the Future of Real Estate Transactions

Implementing new technology in the real estate and mortgage industries has been a relatively slow process when compared to other industries. In recent years, however, things have started to change with the move toward online listings coupled with mobile technology that is speeding up the home-purchase process.

Yet, even with this there is still so much opportunity for disruption in the real estate industry specifically.

One of the key components of that is Blockchain technology. When people hear Blockchain, they automatically think of cryptocurrencies, primarily Bitcoin. This isn’t a discussion about cryptocurrencies, however, this is about what is known as distributed ledger technology. Essentially, Blockchain ledger technology allows for a secure method for carrying out transactions and contracts. It is often referred to as a digital way to keep records and verify those records because of the way it is built (blocked chunks of data that are encoded). And not only that, this kind of technology has the capability of securely sharing data across massive networks, which makes real estate transactions the problem and solution to solve.

When it comes to the real estate industry specifically, Blockchain could alleviate a lot of the defragmentation that takes place within the MLS system. Let’s face it, with so many agents and listings managed within the MLS structure, the ability to share up-to-date information has become a real problem, especially when you consider how the modern consumer expects their purchases to be. As a matter of fact, the structures and systems created to manage real estate transactions need to be rebuilt, or replaced, to continue to deliver a transparent, seamless and secure process that the customers of today expect.

Moreover, the complex network of the real estate transaction process includes such parties as a seller, seller’s listing agent, buyer, buyer’s agent, broker, buyer’s lender, escrow officer, title officer, appraiser, insurance agent, inspector and notary. That includes, but isn’t limited to:

• loan application;
• purchase contract;
• deed;
• title;
• disclosures; and
• closing documents.

With so many stakeholders, paperwork and processes taking place throughout, it is no wonder things can get bogged down or impossible to manage.

Blockchain could solve that problem by centralizing all of the real estate data and making it secure, accessible and scalable. Instances have included managing virtual land and facilitating fractional ownership. Thus, Blockchain could take the current convoluted process and become an application for Blockchain. That would absolutely change the game.

Another way Blockchain could enhance the real estate industry is by turning real estate assets into a digital “token” of sorts.

A new startup is doing just that. It is called Harbor, and it is a compliance platform for “tokenizing” private securities, such as real estate rights into a digital token on a Blockchain. In other words, the company’s “Regulated Token” takes a real estate asset and transforms it into a digital representation. This allows for the sale of such an asset to happen much quicker than it has traditionally.

Forbes breaks it down this way:

Harbor aims to take hard-to-trade assets like real estate and private equity and use Blockchain technology to turn them into tokenized securities that comply with SEC regulations. For example, let’s say an investor group wants to create a private real estate investment trust (REIT)—a company that owns income-generating real estate. In launching their business, “95% of what they do remains the same as it was,” CEO Josh Stein says. “They find a property, form an investment thesis, run an analysis and do marketing.” The difference comes in how regulatory information is stored and securitized.

So, the technology is out there. It is up to today’s real estate companies to invest in the future in order for them to be better prepared to serve the modern buyer in the ways they expect to be served. By partnering with startups like Harbor, I believe many real estate and mortgage companies can use Blockchain to solve much of the fragmentation in real estate transactions that plagued the industry for years.

Not only that, transparency will increase among all the stakeholders in a real estate transaction if all of the data is readily available and up-to-date.

The bottom line is that the MLS system is likely approaching a point of becoming obsolete. It is up to the forward-thinking real estate companies to realize this and replace such an outdated platform with what technology is currently available.

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from theokbrowne digest https://geekestateblog.com/blockchain-ledger-technology-and-the-future-of-real-estate-transactions/

Here Are 10+ Professional Moving Companies Serving the Atlanta Metro Area

Moving home is the kind of decision that is hard to generalize – it may mark a long-awaited upgrade or a sudden change of plans. As such, you may be looking forward to it, or you may wish it wasn’t necessary. Or, granted, you may be somewhere between the two. Either way, there is one […]

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from theokbrowne digest https://www.rentcafe.com/blog/apartment-search-2/moving-resources-apartment-search-2/10-moving-companies-serving-atlanta-metro-area/

Meet the Real Estate Tech Founder: Tom Owen from Home Bay

In our latest real estate tech entrepreneur interview, we’re speaking with Tom Owen, co-founder of Home Bay. He has a long industry track record, and we’re glad to have him as a recent addition to the Geek Estate Mastermind.

Without further ado…

What do you do?

I am the co-founder of Home Bay. I mostly work on product. Formerly I co-founded Zurple, and I still own a traditional real estate brokerage in Coronado, California, called Owen Properties.

What problem does your product/service solve?

Home Bay uses a combination of technology and processes to greatly reduce the amount of Realtor time necessary to facilitate a sale. To supplement those technology and processes, we have a team of highly experienced brokers who answer consumer and agent questions from a centralized location. The above creates large cost savings that we pass on to consumers. For real estate listings, we generally charge $2000 to $3500 to facilitate a sale. On the buy-side, we rebate back half of the commission.

There are thus two key pain points Home Bay solves:

1. We are much less expensive than the traditional Realtor
2. We are able to respond more quickly to consumer needs because of our centralized team that is available 9am to 8pm, seven days a week. Consumers love quick access to quality Realtors. We’ve now closed over 1,000 transactions for buyers and sellers.

What are you most excited about right now?

I am most excited about the ability of our software to coach home sellers through an offer, 24/7. Our database is programmed at the zip code level, and it can literally comment on offers in real time based on the local real estate norms.

For example, if a buyer in Houston at the $200,000 price point asks for a $1,000 home warranty, the software will inform the seller that the buyer is overreaching and suggest an appropriate amount for the price point and zip code. This AI-based real estate coaching exists for all major aspects of an offer.

What’s next for you?

We recently launched in Houston and now cover California, Florida, Georgia and Illinois. We are in the process of expanding our footprint beyond Houston homes for sale to cover all of Texas and launching in Colorado. We hope to cover most of the United States over the course of the next 18 months. We are also spending a lot of time enhancing our buyer search experience.

What’s a cause you’re passionate about and why?

I am passionate about politics. I formerly worked in the White House Speechwriting Office in the Clinton administration, and the political bug never left me. For the last 12 years, I have spent approximately 6 weeks a year living in San Miguel de Allende, Mexico. I keenly follow international politics, particularly as they relate to Mexico.

Thanks to Tom for sharing his story. If you’d like to connect, find him on LinkedIn here.

We’re constantly looking for great real estate tech entrepreneurs to feature. If that’s you, please read this post — then drop me a line (drew @ geekestatelabs dot com).

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3.5 Months into Our Startup ~ Lessons, Learnings, Commentary, and All Sorts of Thoughts

It’s now been 3.5 months since we launched our company Grid Consulting, it’s been an awesome whirlwind of successes, new challenges, and emotional peaks and valleys. We’ve created a fairly large network to distribute our content to in a short period of time and have successfully launched an Instagram, Facebook Biz Page, Facebook Private Group for Real Estate Discussion, Podcast distributed on 4 networks, Youtube Channel, Linkedin Page, and our website. We’ve also partnered with wonderful, forward-thinking brokers, team leaders, and agents to help with the next evolution of their business. Our focus with these partnerships: workflows, operations, and margin expansion (aka make more money!). Lastly, we’re working on our secret behind the scenes projects that we’re incredibly excited about.

So..what have have we learned since going out on our own? Here are some musings:

Positives and Challenges: It’s incredibly hard, but don’t let the doubt defeat you!

• Positives: It’s all a test, challenging your psyche, determination, and willingness to power thru the peaks and valleys.
• Challenges: You’re used to things being easier (but harder) because you often have months or years of company development behind you.

Positives and Challenges: The psychological warfare is real

• Positives: The peaks are incredible, you’ll find yourself in a state of bliss, a state where you can do anything you set your mind to and every win is a win, independent of the size.
• Negatives: The valleys are awful, you’ll find yourself in a state of sadness, a state where you question your confidence. This is totally normal, power through it, you’ll be surprised how quickly you can train yourself to snap out of the valleys.

Positives and Challenges: Your Sphere of Influence and their support

• Positives: You have those people in your life that will support you with whatever it is you do. They believe in you, they trust your purpose, they have unwavering belief that you can do whatever you put your mind to and are willing to do the work necessary.
• Challenge 1: You also have those people in your life that will tell you they support you, when in reality, behind the scenes they’re either wishing for your failure or thinking your project is stupid.
• Challenge 2: People that you were previously close to or that used to support you disappear from your life. It’s ok, you can solve for the two above and use it as motivation.

Positives and Challenges: Lack of brand awareness

• Positives: You get to create your own brand identity, you get to throw out all rules or guidelines, and start over from scratch.
• Positives: You get to test alternative ways of brand development, succeeding sometimes, failing others, but you get to swing away more rapidly.
• Challenges: It’s really hard to develop a brand from scratch and it often takes a long term outlook. Determination, willingness to see the big picture, put in the work, and continually develop your network of distribution.
• Challenges: People may question intent, but this can be resolved by having a strong mission driven purpose.

Positives and Challenges: Small team size

• Positives: You can move much quicker with a smaller team. In the early years of Amazon, Bezos instituted a pretty awesome rule: every internal team should be small, meaning it can be fed with two pizzas. Like almost everything Amazon does, focused on two aims: efficiency and scalability. The former is obvious. Smaller team’s spend less time managing timetables and keeping people up to date, and more time doing what needs to be done.
• Positives: Politics or lack thereof . Smaller teams that came together to start something anew, often get the benefit of a less politically driven, career titles and personal growth oriented culture.
• Positives: Titles don’t matter, it’s about execution, efficiency, performance and purpose.
• Positives & Challenges: You spend a ton of time with your small team, lol.
• Challenges: Each team member has to do more to get large projects done and you often need to outsource subject matter experts for specific jobs, costing $$$.
• Challenges: There are less checks and balances, meaning your trust in your team members needs to be “100.”

Positives and Challenges: Change in income

• Positives: Money can change you, for both good and bad. Resetting your priorities can be enlightening. When you started you career, you had certain goals, purpose, and a why, when you grow, this often changes. One of my own tricks to eliminate complacency has always been to ‘go broke again.’ This doesn’t mean actually broke, but rather trick myself into thinking that, by putting money away and setting smaller spending budgets. When you start doing this, you’ll eliminate the unnecessary, compulsive spending habits that income can create over time.
• Positives:I recently read an interview of Simon Sinek, he said “There is a cost for the money we make and sometimes the cost is not worth it. That goes for companies and individuals.”
• Challenges: You created a certain expectation on weekly, monthly, and annual income, now you’re starting over. It’s ok, it’ll be fine 
  
  from theokbrowne digest https://geekestateblog.com/3-5-months-into-our-startup-lessons-learnings-commentary-and-all-sorts-of-thoughts/
  

Plain Vanilla Shell Condition Meaning in Commercial Real Estate

When buying or leasing commercial real estate you will often come across a space that is in plain vanilla shell condition. Other terms you may have heard are cold dark shell, warm shell space, grey shell, etc. As you can see it can get kind of confusing and to make it more interesting the definitions differ by market, situation, or whoever owns or is listing the building. The devil is in the details so it’s important that you know HOW the space will be delivered to you.

Ensure that the lease or sales contract clearly states the condition that the owner or landlord is going to deliver the space.

Definition of Shell Condition

The simple definition of shell condition is a commercial building (office, retail, or warehouse space) with an unfinished interior space. All that has been built are 4 walls, a roof, and a concrete floor. You will NOT see any hvac, lighting, ceilings, elevators, plumbing, interior walls, etc.

Because every tenant has specific needs landlords typically like to leave in cold dark shell condition, then offer a tenant improvement allowance to tenants during negotiations which will cover a portion or all of the improvements. This allows each tenant to customize the space to their liking.

Examples of Commercial Spaces in Shell Condition

Warehouse space in cold dark shell condition

retail space in shell condition

Retail space cold shell construction

Office space in shell condition

Office space in plain vanilla shell condition

 

 

The Best Metros for Your Profession: San Jose Tops the List, and Not Only for Those in IT

From doctors to artists, lawyers to professors, it’s no secret that we all strive for a good financial situation, among other things. While switching professions could be an option for adding more zeros to that bank account, many would agree that it requires a lot of time, dedication and unnecessary stress. So, how about switching cities? In […]

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from theokbrowne digest https://www.rentcafe.com/blog/apartment-search-2/best-metros-for-your-profession/

Is Amazon Really “Reinventing” the Construction and Real Estate Development Markets?

[Note from editor: originally published on AEC Labs]

A recent article in the UK’s Construction News publication (also picked up nationally here in the US by Bisnow) suggests that Amazon is “reinventing” the construction and real estate development markets thanks to its incredible growth, both in the US and abroad.

But what, specifically, does that mean? And should construction industry stakeholders feel “emboldened” or “threatened” by Amazon’s disruptive tactics? We have some thoughts to share on that assessment here at AEC Labs that should be of interest, and import, for AEC stakeholders who are keeping tabs on what the growth of tech giants like Amazon, WeWork, Google and others could mean for their business models here in 2018 and beyond.

• Office Space: like many tech companies, the Amazon campus’s office plans are open with lots of room for collaboration and socializing. But they go far beyond traditional cubes: the new spheres in the middle of its headquarters in Seattle’s South Lake Union neighborhood have over 400 species of trees that provide shaded areas for teams to meet and brainstorm among nature. They were not easy to design or construct, as you might imagine – the design architect and contractor (NBBJ and Sellen, respectively) have been tight-lipped about all of the technical components of the project. But this suggests that other firms looking to capture work in the tech space will need to confront similarly aggressive requests from clients, which not only has risk and liability implications, but will also test these firms’ technical capabilities and limits.

• Fulfillment Centers: the industrial markets have been booming nationally not only for Amazon fulfillment centers, but other e-commerce logistics facilities thanks to the growth in online retailing generally, from Walmart, Jet.com, Boxed, Wayfair, Zulily, and so many others. For AEC stakeholders, this means understanding how these kinds of projects are delivered (typically build-to-suit by an industrial landlord, like a Prologis, which will use bridging design documents that consultants prepare for the e-commerce provider). The technical specifications for these facilities are also becoming increasingly sophisticated, with automated components (like Amazon’s Kiva robots). So staying ahead of the technical curve for these kinds of clients will be critical for firms looking at the industrial e-commerce sector as a growth market.

• Physical Retail: The retail meltdown continues in 2018 – from Toys ‘R Us to others that simply can’t compete in the age of online shopping and evolving customer habits. It’s not just retail stores, though, that are suffering; shopping malls and movie theaters are all struggling to reinvent themselves and attract new customers whose tastes and interests continue to shift. It’s simply not enough to be a firm that specializes in a retail sector; mixed-use, entertainment destinations are the name of the game. And, with more Americans wanting to live and work and play in the same location, design firms in particular may need to evolve the profile of the types of clients they work for. Residential developers, in particular, are notoriously difficult clients, which will make risk management critical for firms looking to expand into this market.

• Amazon Go: Automated checkout technology – whether at a grocery store, a convenience store, or other physical stores – could transform this segment of the commercial interiors market, where many contractors specialize. Amazon rolled out a pilot Go store last year at its corporate headquarters in Seattle, and rumors abound that an expansion to New York City and other major cities is imminent (Chicago and San Francisco will be coming online soon). Designers and contractors will need to understand how this technology functions and adapt their processes accordingly.

• Artificial Intelligence: Amazon has invested heavily in AI and predictive algorithms for almost all of its twenty-plus year history, and it seems likely that there is a great deal to come for AI innovation. Here, the company’s recent Echo/Alexa partnership with Lennaris very interesting. Could we see Alexa-enabled smart homes delivered prefabricated through a third-party provider like a Lennar? Perhaps. There is a lot of work to be done in the AI space, but it could be coming, and quite soon.

But perhaps what’s most interesting (or frightening, depending on your perspective as an AEC stakeholder)  is a prediction from US-based retail analyst Neil Saunders of GlobalData that Amazon could ultimately try and target the construction and real estate sectors themselves.

“If Amazon ramps up physical expansion, I can see this happening. Amazon likes to vertically integrate aspects of its operation, such as delivery, so it is possible that it will create its own construction and development team. At the very least, the team might focus on the refurbishment of Whole Foods stores, but when you add warehouse expansion, new shops and offices into the mix, then there is the volume necessary to support such a team.”

Analysis from AEC Labs

So could Amazon eventually launch a real estate development and construction operation that tries to compete with Katerra or WeWork? Perhaps. No market seems beyond the behemoth’s reach, and more generally nobody should feel safe in their competitive position in our tech-driven, 21st century economy. And in some ways the company has already made a foray into the landlord space – its marketplace business allows third-party sellers to store their inventory in Amazon fulfillment centers.

But, much like how AWS launched after the legacy retail e-commerce business outgrew its traditional server space, it’s not inconceivable to think that as the company’s internal construction and development teams grow more sophisticated, Amazon could see value in providing their services to third parties. And, as the company continues to expand into brick and mortar retail with its Whole Foods acquisition and launching more Amazon Go stores, there is no reason why it couldn’t vertically integrate itself into a full-service design, development, and real estate player, providing fully kitted out retail storefronts. (This wouldn’t be the first time it competed with itself either – when Jeff Bezos made the decision to open up the Amazon.com platform to third parties (like Ebay), many pundits scratched their heads.)

In any event, there are many reasons to keep an eye on Amazon, and AEC innovation is just one of them. We’ll be paying close attention to this space during the rest of 2018, particularly as more Amazon Go stores roll out across the country.

[Note from editor: originally published on AEC Labs]

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Meet the Real Estate Tech Founder: Brian Bair from Offerpad

In our latest real estate tech founder interview, we’re speaking with Brian Bair from Offerpad. He’s the co-founder and co-CEO of Offerpad, as well as has a background as a licensed real estate agent. Brian previously served as co-founder and managing partner of Lexington Financial, LLC and Bridgeport Financial Services LLC, one of the largest acquisition and sales companies in the Southwest.

Offerpad is one of the most well known and funded iBuyer startups, offering buyers increased control and certainty. They recently announced a major re-brand, as well as $150 million in new funding.

Without further ado…

What do you do?

I am the co-CEO and co-founder at Offerpad. We are based in Arizona, and available in eight total markets at the moment. Our company works directly with consumers to help eliminate the stress of selling and buying a home. People can request an offer on their home by entering in their property address to our website, upload photos and important details on their home, and within 24-hours we will send an offer for review.

After accepting the offer, the homeowner selects their closing date, whether that is within 10 days or 80+ days, we will work with them to align with their schedule. Customers that are looking for an immediate move, on average are selecting 22-days to close.

I manage a lot of the day-to-day operations and have an amazing team that executes against our strategy. A lot of our business model stemmed from my years as a top-realtor. I saw a lot of pain points that my clients dealt with and I knew there was a better solution we could provide.

What problem does your product/service solve?

Consumers can take on an enormous amount of stress when selling a home. The questions of when I should sell my home, how much can I actually get for it, will I need to renovate it before putting it on the market, how long will it sit there and what double expenses may I incur, is part of the uncertainty one may face.

OfferPad can help eliminate that stress, plus more. Our customers don’t need to worry about showing their home and finding movers – we can on that responsibility and the others mentioned above.

In fact, our customers select their closing date. This allows them to sit behind the driver’s seat during the process and guide a timeline that works best for their schedule.

What are you most excited about right now? What’s next for you?

The opportunities for the real estate industry to change are enormous. We are so excited about the opportunity to continue expanding our offerings and grow into other markets. We are passionate about real estate and being the solution that people turn to, allowing them to move freely.

What’s a cause you’re passionate about and why?

I am passionate about people. Everyday people are struggling with very different situations in their life. It could be someone devastated with a cancer diagnosis, a sick child, an elderly person alone, a family going thru financial problems, people dealing with the struggle of making the most out of their life. There are times that I think we all make a mistake of getting so “life busy” and not stopping to help someone in need. Many people are dealt such challenging situation and I am always so amazed of how strong people are. Overall, I value and love people. I believe people are good, people are caring, people are kind. I want people to succeed so we can all live a happier life!

Thanks to Brian for sharing his story. If you’d like to connect, find him on LinkedIn here.

We’re constantly looking for great real estate tech entrepreneurs to feature. If that’s you, please read this post — then drop me a line (drew @ geekestatelabs dot com).

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Hacker Connect 2018 in San Francisco (& $100 Off for Geek Estate)

I’m guessing many of you are going to San Francisco for Inman Connect next month. If you’re reading this blog, the chances that you’d enjoy the Hacker Connect portion of Inman are pretty good.

Hacker Connect is a full-day of sessions on Tuesday of Inman week, plus a networking reception following the conference. Examples of sessions:

• Redfin’s approach to user friendly products (by Redfin director of product Pei-Chin Wang)
• Building an intelligence in CRM (by Geek Estate Mastermind member Zvi Band)
• Beyond cryptocurrency: Blockchain applications for RE

The full agenda can be viewed here.

Who: Engineers, developers, designers, product managers, database architects, webmasters and technology executives.
When: July 17th, 9 AM – 5 PM
Where: Hilton San Francisco Union Square (333 O’Farrell Street, San Francisco, CA 94102)
Cost: $299
Register: Here

Note you may use the “ICSF100Geek” discount code to save $100 off the listed ticket price of $299 (if you use this link to register, the discount will be applied automatically).

Hope to see you next month!

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