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.
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, Sam. Cheers.
