Photo by Joe Zlomek. Malvern PA, April 2006
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May 17, 2006: Commercial Property Gets 'Sticky'

By Joe Zlomek

Finding the right property for a retailer is about to become a little sexier.

Today's editions of The Wall Street Journal report that CoStar Group Inc. is introducing new software to give merchants, commercial agents, tenant representatives, developers, and others an enhanced ability to preview available retail spaces. CoStar provides property-listing services to commercial real estate brokers in the same way a multiple listing service (MLS) works for residential brokers.

Photo by Joe Zlomek. Blacksburg VA, May 2006Marketing commercial properties – everything from storefronts to warehouses to office buildings – is substantially different than marketing single-family homes. Commercial clients are harder to find, more expensive to attract, and take longer to cultivate. In addition, the potential occupants’ needs are polar opposites. Consider the typical homebuyer: he or she usually wants to locate in a quiet neighborhood with little traffic. Commercial space users, on the other hand, thrive on traffic. They want locations in busy centers, near other busy centers, to draw thousands of cars. 

The great marketing equalizer for both residential and commercial agents has been the Web. Giving clients the ability to see and know as much about a property as possible, using the Internet as the intermediary, allows them to compare and make better decisions about prospective sites. The more you tell, the more you sell; many residential brokers have known this truth for years, and have re-tooled their websites accordingly.

Recent research demonstrates that adding Web-based value-added features like 360-degree views of a property, online virtual tours, streaming audio and video, and to-scale interior floor plans increases prospective buyers' interest in seeing that property. Online listings that feature virtual tours, according to Realtor.com, are 40-percent more likely to viewed by website visitors than those without them. Web designers call this phenomenon "stickiness," because the features keep visitors stuck to a page. And as more consumers buy faster computers with faster Internet connections, they demand more sticky content to help them evaluate their buying choices.

It's taken a while for some commercial firms to understand the importance of stickiness. CoStar apparently gets it. The firm mounted digital cameras on poles atop trucks equipped with GPS tracking systems, and sent its drivers out to catalog characteristics of almost every one of the more than 450,000 retail properties in the country, The Journal says. Soon CoStar listings will include demographic data, maps, available and usable space statistics, and competitor locations. All of them will be updated monthly, too.

Stickiness helps residential agents sell more properties faster. It should produce the same benefit for commercial agents too.