Technology still reliant on business principles.
Such was the consensus of participants of a roundtable discussion on real estate dotcoms sponsored by Real Estate Weekly. Putting references to The Who's "Won't Get Fooled Again" aside, participants agreed that survival in the dot-com industry hinges on the same basic business principles as survival in more traditional industries.
"I think it's pure old-fashioned business principals. You have to bring in more money than you are spending, it's as simple as that. You have to develop a business that works in the long run," said Michael Sokolow, cofounder of PropertyRover.com. "The idea that the Internet was immune to that was never true and that was proven."
Among those who participated in the March 8 roundtable were Sokolow; Robert Bruning, vice president of web marketing for Reis, Inc.; Neal Lerner, president of lookingforspace .com; and Heather Shively, cofounder & chief executive officer of CapitalThinking.
Participants agreed that despite the "doom and gloom" surrounding dot-coms, the Internet is here to stay.
"Despite the market slamming dot-coms and the technology sector, this is a good industry and a good business," Shively said. "What is happening in the market is not to say value isn't being created, it's saying it was mispriced for awhile."
Sokolow agreed, calling the media coverage surrounding the Internet "a double-edged sword."
"The hype was never as great as it seemed last year and I don't think that it is as dire as they are making it out to be right now," he said. "It might make great copy or a great story, but it is not necessarily true."
Despite the reluctance of the industry to adopt to technology, the panel agreed that the Internet can provide valuable tools to help facilitate traditional real estate processes.
"I see the web as a great tool to distribute information that is more consistent to a wider variety of people within organizations so that decisions are based on more consistent information," Bruning said.
The participants also agreed that the goal of the industry is to "web enable" traditional processes, not to replace them with technology. Similarly, they said the web will not replace the traditional face-to-face deal making that is at the heart of real estate business.
"This is the business about making deals, closing deals, and managing assets. A technology company has to deliver value," Shively said. "This can be done either by doing more deals, closing deals more quickly or cheaply, or finding new customers."
The panel also discussed the difficulty in getting financing and the importance of making wise decisions when spending money.
"I think that we've seen a problem with using other peoples' money in that it affords people in the listings area a certain amount of largess," Lerner said. "Had they been working with their own money and their own profits, they wouldn't be expressing themselves in certain fashions.
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|Publication:||Real Estate Weekly|
|Article Type:||Brief Article|
|Date:||Mar 21, 2001|
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