Big CRE Firms Keep Investing in Proptech Companies
They not only look for upside but to fill tech gaps they have in their operations. Other investors can learn from what they’re doing.
Want hints on where to invest in proptech/? Check where the big firms are publicly putting their money.
Marcus & Millichap has been implementing technologies from two different vendors, as the San Fernando Valley Business Journal recently reported. In November, the brokerage announced a partnership with Archer, which makes predictive acquisitions software for multiple property types. The relationship included Marcus & Millichap’s use of the technology as well as an equity investment in Archer, according to a press release at the time from the former.
“We value Archer’s technology and the strategic benefits they provide our brokers and clients and took the opportunity to expand our partnership with an equity investment,” said Richard Matricaria, Marcus & Millichap’s chief operating officer, Western Division, at the time in prepared remarks.
In December, the brokerage made an equity investment in EquityMultiple, a provider of real estate financing and investment technology. “Our investment in EquityMultiple allows MMI to be part of a leading innovative technology platform that further expands our array of capital sources and solutions and creates synergies to facilitate the acquisition, recapitalization and restructuring needs of any commercial real estate transaction,” said J.D. Parker, Marcus & Millichap’s chief operating officer, Eastern Division, in prepared remarks at the time, adding that the firm “strategically invests in proptech ventures.”
Marcus & Millichap has company from other large CRE firms. JLL Spark, the company’s venture arm, says it has invested more than $390 million in more than 50 early-stage proptech startups. Colliers has its venture portfolio for strategic investments in “emerging technology companies across the real estate value chain.” The portfolio includes more than 20 companies.
Getting investment cues from such activities is both easy and not. The big companies regularly run press releases about their latest investments, and if they don’t, the companies receiving the equity investment might. So, the information is often available for the looking.
The difficulty can be making an actual investment. When still seen as emerging technology firms, companies generally aren’t public. Investing requires being an accredited investor and then finding a path, possibly directly or maybe through some venture fund. Over time, some of the companies might go public, in which case keeping track of them — and doing additional research into them over time — can offer an informed view of a good investment.