Don't Compromise on Comps
Comparables sales, leases and properties are an essential part of the commercial real estate business. From valuations in investment sales, rental rate negotiation in tenant representation, and competitive positioning in landlord representation, building and maintaining a comp database can put you a step ahead of the average broker.
If you are relying on third parties for comps, you’re doing it wrong. It’s important to note that listings aren’t comps—they’re advertisements.
Consider TRUECar, the automobile shopping and price transparency service. It exists because of the difference between MSRP and what someone actually paid for a car. They empower consumers to see what others paid for the same car, thereby giving them negotiating power when making their own purchase. You wouldn’t rely on MSRP to appraise a car, so why do it with commercial real estate?
This concept is not new, but brokers still rely on list prices for comps when they should be focusing on the closing price.
There’s no shortage of data providers out there that can help you get the closing price. Whether it’s a data research company or deed transaction aggregator or the county recorder themselves, brokers should capture this data and put it into a system where they can leverage it for their purposes.
Once you’ve identified your trusted source(s) to find this data, we’ve got the perfect place for them.
Creating comps in Apto
Tracking on-markets gives you the ability to build prospecting lists based on listing or assignment expiration date, potentially providing a business opportunity for you. In the event these listings and assignments don’t expire but close, you will capture comps that others miss.
The first method to create a comp is to start with another Apto data element: Listings and Assignments. This feature can be used for other purposes, but here we’ll focus on how it benefits you in building a comp database.
If you are tracking your listings and assignments in Apto, then you’re seconds away from converting them into a comp. You should be tracking both your own deals and other’s on-market deals. Once you close your deal, hit the “Convert” button to move it through your workflow. For an on-market deal, the “Convert” button immediately turns the listing into a comp.
The new Comp carries over all the details from the Listing like Seller, Landlord, Price, Property Square Footage and more. To complete the Comp, click "Edit" or double-click next to the field name to perform individual edits.
Another way to build out your comp database is to add them from a third-party data source. This can be done one-by-one by you, your support staff or through a data import with Salesforce’s data loader tool. Most providers allow you to export the data to a CSV file, which can then be loaded into Apto.
Maintaining your comps
Apto property records reflect property ownership and space occupancy through features called “Ownership” and “Spaces” respectively. When a property changes hands or a space gets a new tenant, entering it as a new comp will fire a trigger that automatically modifies the ownership and space on the property to reflect the change. No dual entry. No having to remember to change all the places where this information should be reflected. One step and you’re done.
Using your comps
Comps are in, check, now what? To put them to use, we turn to Reports.
Apto’s reporting engine allows you to generate lists of comps based on specific criteria. Reports are editable and can be saved using the name of your choosing for quick use, recollection and re-use. They can also be exported to a spreadsheet for use in newsletters and valuations (BOV) presentations.
To access Apto Reports, click on the "Reports" tab, (or click ont the "+" icon and click on "Reports" in the tab list). Search for "comps" under the Folders search on the left side. Click on the Comps folder and select your desired report. To learn more about creating and modifying reports visit our knowledge base article Create New Reports.
When the report opens, you can choose to customize, export into a printable view or just the details, or even subscribe to recieve updates in your email inbox. Simply click on the button above the table.
You may be doing all this already, and if so, great. What we hope you see is that Apto makes this process easier and more efficient. It can help you deliver the timely pricing information you need to give a highly defensible valuation backed up by the industry’s best comp database: yours.