How industry gossips inspired a new online opportunity for facility leasing
Almost all small business people have had to fend off unsolicited offers for new products or services at one time or another – in many cases, when they have entered the market for something else.
It was a trend that former commercial leasing agent Matt Sampson observed once he started his own business, putting leasing deals together in the industrial property market.
“Currently as a tenant, if you go out and start talking to a lot of different agents your name can get spruiked through the market – so they know someone is looking,” he told ATN.
To help avoid this, Sampson hit on a new idea – what if tenants and landlords were able to deal with each other directly, and cut out the middleman?
Sampson’s new online platform uTenant aims to do just that – streamlining the process of finding, inspecting and leasing warehouse space by allowing a website to match both the tenant and the landlord.
While some have compared the site with AirBnB, Sampson notes that unlike the room-sharing website that has shaken up the hotel industry, uTenant does not advertise properties or tenant profiles online.
Sampson said the company would simply be a service provider, linking tenant with landlord and taking a fee for the introduction.
“They then negotiate any lease or short term logistics contract… and if a successful deal comes out of that then we get paid… we don’t take any involvement or any fees throughout the lease term,” he said.
Finding Prince Charming
“We are almost like a dating site where you put your requirements in for what you are looking for, and then matches are made in the background, rather than having to sort through listings,” Sampson said.
This can include information such as power needs, floor loading for specific weights or whether dangerous goods will be stored at the property, as well as the floor space required.
“We will procure a list of real options for you and then provide that to that particular tenant as opposed to that tenant having to search online – there can be a lot of listings that don’t exist or maybe they have been sitting there for a little while, so it is hard to know what is actually available.”
This will also extend to short-term leasing – with landlords in the warehousing industries able to advertise short-term surplus space, should tenants be looking for an overflow for a one to six month period.
Sampson said no-one in the commercial leasing space had yet succeeded in creating a space where short term and longer term arrangements could be made.
“When there is surplus space sitting there someone is paying for it, so if there is a way we can try and connect people when they have short term overflow with this surplus space, that is another point to this,” he said.
Early adopters on board
The plan has already won support from a number of industry organisations, with container logistics operator ACFS Port Logistics CEO Arthur Tzaneros saying the company will be a game changes for how the industry procures short and long-term warehousing space requirements.
“As a progressive organisation, we are constantly on the lookout for new technology and innovative methods to help us drive efficiencies,” Mr Tzaneros said.
“We believe the uTenant model is the way forward for our industry and we look forward to utilising the platform in the future.”
CEO of the Victorian Transport Association Peter Anderson has also praised the potential of the website, saying many of the VTA’s 800 members could tap into new revenue streams by leasing out otherwise unused space.
“While leasing otherwise unoccupied space like this is not uncommon for operators, the uTenant model could conceivably provide them with a seamless and relatively effortless way of generating additional cash flow on long-term, short-term or casual basis,” he said.
“And for an industry like transport that runs on very thin margins, every new revenue stream represents an opportunity to grow the business and industry, which translates into more jobs and more economic prosperity throughout the whole supply chain.”
Broadening appeal
For Sampson, the challenge is in building uTenant after its launch last year – and developing awareness of the company.
So far, Sampson says the company has been focusing on tenants seeking out more than 3,000 square metres of space.
“The vast majority of tenants occupying those facilities are within transport, logistics, third party logistics, freight forwarders and other transport related businesses, as well as warehousing, some retail, e-commerce businesses,” he says.
A standardised national fee structure meant that all landlords were on a level playing field, he added, rather than the current market where each state had a different fee rate.
“Most landlords are aware of what we are doing, but the big education is out for the tenants, just to say that hey, there is a different way of doing things now,” he said.
To help with this, the company is offering 10 per cent of its fee back to any tenants using the services in all states except New South Wales.
“It is not every day that people in these industries have these requirements, so it is a matter of making sure that we are front of mind when they do, and getting them to come and check us out,” Sampson says.
“But so far, so good. Our next phase will be growth and looking to employ people over the coming months, before the end of the financial year.”
Ultimately, with additional volume, Sampson says the uTenant platform could become fully automated, rather than relying on manual input and phonecalls made by its staff to check what is available.
“Once we get the model right and validated, and things start happening, we can look to see where else would be suitable – it is not going to work just anywhere,” he says.
“It’s a pretty simple concept, it is just bringing that into action is the next phase.”