Commercial real estate has long been dominated by a tight-knit network hesitant to change an archaic system. That’s no longer the case — thanks to CREXi.
By Bradley Zint, California Business Journal
Michael DeGiorgio looked at the world of commercial real estate and saw a problem: Mostly every other business segment and aspect of modern-day life was full of technological advances, timely communication, easy interfaces, quick turnarounds, and speedy service. Commercial real estate? Quite the opposite.
“You have really smart and talented professionals in the industry. Yet transacting on a deal, even when all parties are eager and willing participants, has historically taken a long time,” DeGiorgio notes. “Supply and demand, are largely disconnected from each other almost as if they are playing in a black box. Transactions lack transparency and are very human intensive adding fee layers for all parties.
So DeGiorgio created a platform to dramatically change things. It became known as CREXi, which stands for Commercial Real Estate Exchange, Inc.
The Marina del Rey-based company, which officially launched in late 2015 and now has more than 50 employees, allows for a more streamlined exchange, an A-to-Z, intuitive solution that’s easy to use, says DeGiorgio, who serves as its Founder and CEO.
Its primary feature is an open marketplace for both buyers and sellers that showcases currently more than 56,000 listings throughout the country. CREXi also offers a CRM system (customer relationship management), enabling users to follow their pursuits for listings they want, and conduct market and due-diligence research, among other features.
Meanwhile, sellers and their brokers can transparently track and analyze buyer interest for their offerings, identify who is looking at their listings, who signed confidentiality agreements, who downloaded online packages, and uniquely manage offers received.
“We made CREXi insightful and intuitive because that’s what the industry desperately wanted,” DeGiorgio says.
When properties are in escrow, CREXi’s platform shows when environmental reports are expected to be done, when earnest money deposits go hard, and the stage of various agreements.
“All those critical elements happen seamlessly,” DeGiorgio says.
One driving philosophy of CREXi: speed and liquidity. DeGiorgio has seen sales on the platform happen in as little as 40 days, from going to market and getting offers to closing the deal and handing over the keys. Traditionally, that process may have taken three months at a minimum and sometimes years for tricky deals.
CREXi has been evolving constantly since its beginnings. Since 2015, the site has launched more than 80 new releases. They come every two weeks; some are simple, some more dramatic. The company takes feedback to heart. Industry professionals are even known to visit CREXi’s Marina Del Rey office and check things out first-hand.
“New releases have been driven mostly by our buyers, developers, brokers and the industry using the site,” DeGiorgio says.
Before founding CREXi, DeGiorgio studied marketing and sales at Northern Illinois University. Soon after, he started a career at Auction.com and quickly learned that large commercial real estate properties could be transacted mostly online.
“I benefited from being new to the industry and lacking ‘this is how things have always been done’ blinders,” he says. After about three years as a leading salesperson, he left to launch CREXi.
What he learned at Auction.com is that no two deals are exactly the same.
“If you’re going to bring this world onto a digital platform online, really bring modern times to this antiquated space, you have to build a flexible platform that allows for multiple ways of doing things,” he says. “And it has to be really easy. In the industry, time is money.”
DeGiorgio pauses for a moment then and quickly adds, “Time can kill deals.”
He realized early on that his endeavor has to be built for everyone: buyers, sellers, appraisers, brokers, cooperating brokers, lenders and escrow agents.
“There are so many people who need to be brought into this world,” he says.
While still a young company, CREXi has had tremendous success with more than 250,000 people using the platform each month and $500 billion in property to market. Each month, CREXi facilitates an estimated $10 billion in offers made on 10,000 properties. CREXi can claim every major brokerage as a customer and has spread to all 50 states. Investors have also taken notice and CREXi has raised approximately $25MM in Venture Capital financing.
The company is continually looking to the future and plans to continue to expand the product while always maintaining a free offering. CREXi is also getting ready to launch its leasing platform.
“There’s going to be a lot of ways for the industry to access better data around different properties, different markets,” DeGiorgio says. CREXi may also look for adding lending partners and social aspects to connect with dealmakers nationwide.
Adam Siegel, who manages marketing and analytics for CBRE’s office in Newport Beach, California started using CREXi in 2016. CBRE is always looking for new avenues to market its listings and had used other websites, but found the costs too high.
“CREXi was great at getting us up and running quickly,” Siegel says. “We were able to utilize their reports and services easily and appreciate the insights they give us. In addition, the push marketing they gave us was exceptional, and we saw their database numbers grow quickly to be formidable.”
Siegel says CREXi has been able to generate offers on listings from clients CBRE didn’t have in its database or were unable to reach.
“We also have seen that even while they have grown very quickly, the quality of customer service at CREXi continues to be excellent and hands-on,” he adds. “We’ve been very transparent about the viability of its platform with our other CBRE brokerage teams.”
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