The brokerage startup has famously raised more than $70 million, with investors including New York real estate names like Bill Rudin and Jared Kushner. It’s now valued at $360 million. It has lured big brokers, including Leonard Steinberg and most recently, Brown Harris Stevens’ Kyle Blackmon.
The company is all about its competitive advantage through groundbreaking technology, both for the consumer and the broker. But what exactly that technology looks like has everyone in the industry scratching their heads — a mystery akin to the existence of the Loch Ness monster or the disappearance of Malaysia Airlines Flight 370.
I think I know what they have in store. The new way in which a person will buy a home in Manhattan just 12 months from now is quite staggering:
Think “1984.” First, you arrive at Urban Compass’ office, and once seated in a reclining chair, a Google Glass-type apparatus is affixed to your forehead. You log into your email and Urban Compass downloads and sorts all real estate information from your messages. Using a complex algorithm, it forms a preliminary picture of your hopes, dreams and desires, and how that translates into where you might want to plunk down a $200,000 downpayment.
Next, you type answers to seemingly random questions into proprietary software. You are done! Urban Compass now knows where you want to live and how much you’d like to pay, and using real-time marketplace software, makes sure there are no competing bids or offers.
A driverless car awaits to whisk you to that address (already programmed into the car’s GPS.) When you arrive, you whip out your iPhone, swipe it (using Apple Pay) and, assuming you are good with the price (your only decision), the place is yours. Another Urban Compass team has already arrived at your old apartment, ready to put it on the market, taking listings photos and packing up personal items.
All this saves the agents’ time and makes them more productive, the stated goal of Urban Compass’ business model. The average NYC broker spends a staggering 89 percent of their time performing administrative tasks, says CEO Robert Reffkin.
If this doesn’t work out, there’s a backup business plan: Urban Compass will use a traditional brokerage model, but each client will get a free iPhone 6 with a complimentary download of the latest version of Angry Birds and the Kim Kardashian app.
Of course, this is all in beta-testing — in my mind. But if it any of it works out, I want an equity stake.
Given the track record of Urban Compass’ principals and their level of sophistication when it comes to tech, it won’t be surprising if whatever lies ahead is, in fact, a billion-dollar success. (Reffkin’s CV includes Goldman Sachs, McKinsey and Lazard, and executive chairman Ori Allon sold his last two companies to Google and Twitter.)
Check out E.B. Solomont’s story on the puzzle that is Urban Compass on page 68. (We also have Reffkin talking about the latest book he is wading through — it’s about business development — in our monthly feature on what industry pros are reading, on page 78.)
Elsewhere, we examine the biggest real estate issues ahead in 2015 in our cover story this month. The coming year is poised to see the number of new development launches double from this year, which should make things interesting. Will prices continue their rise or stall out? What effect will likely rising interest rates have? Is Queens the new Brooklyn, Brooklyn the new Manhattan and Manhattan the new… London, thanks to international interest? Read on to find out.
Finally, check out our pieces on the biggest residential broker moves of the year on page 44, the largest retail storefront buyers on page 58 and a preview of the big ICSC retail conference this month on page 60, just in time for holiday shopping season.
Enjoy the issue, the holidays and the New Year.