Biproxi is a tech company in the commercial real estate industry, and tech companies are generally very good at cutting out the middleman. The commercial real estate industry is a thicket of middlemen, but unlike Airbnb or Uber, Biproxi don’t try to cut out the middleman. Its purpose is to make it easier for all the different intermediaries to get in touch and stay in touch with each other.
We spoke with Tabitha Satterfield, co-founder of Biproxi and veteran of commercial real estateon the company’s mission to become “the Tinder of commercial real estate.”
Daily Grit: Tell us about your journey.
Tabitha Satterfield: I started with commercial funds. Probably 15 years ago, I worked with a group that raised money to buy distressed debt from banks, and we would end up settling those loans or foreclosing them.
During my time there, I used a platform called auction.com to dispose of these assets. I learned about how technology can be integrated into a transaction process. I left the fund and went to auction.com, worked in their capital markets group for a few years. We created a line of credit for people to go to auction houses or courthouses and bid on properties without having to come in with a cashier’s check and then be able to participate with a line of credit.
I spent a few years doing this, then decided to help myself, either brokers or sellers with a layout through an auction platform. After a total of eight years at auction.com-slash-Ten-X, I transitioned into a brokerage channel where I began educating brokers on how they could leverage technology to help them in their provision.
A few years later, I met my business partner Gordon at Ten-X while he was in that position. He wanted to create a business that didn’t have so many sticking points. That’s when we moved to build Biproxi and I’ve been with Biproxi for about three years now.
The Biproxi mission
Daily Grit: Biproxi’s mission is to “fundamentally change the way commercial real estate is bought and sold”. How is it bought and sold now in a way subject to change? And what are some of the pressures against change?
Tabitha Satterfield: Everyone is very protective of their role, especially if something has been done the same way for the past 30 years. If a broker has been doing this for 30 years, he has his Buyers Rolodex. They are very big on networking and know who the buyers are. They ask themselves: “Why do I have to integrate a technological tool? But by not embracing the technology, they lose accessibility to new buyers.
Transactions are large and fragmented. We’re marketing it here, we’re going to trade it here on this tech tool, or even internally, and now we’re going to bring in a financial partner and we’re going to take care of it. Then we’re ready for escrow and title, then the lawyers come in, so now you’re back to trading. There are a lot of these moving parts and emails going around, and nowhere to really collaborate in one place. It’s very fragmented, so there’s the ability for technology to step in and change the way it’s done.
I think the most reluctant are brokers and lawyers, who charge hourly rates and obviously want to capture their fees.
Brokers fear being replaced, but I believe brokerage is an art. There is a story to be created with every asset brought to them. But what technology can do is bring efficiencies to their process.
Daily Grit: Biproxi describes itself as the Tinder of commercial real estate. What does it mean?
Tabitha Satterfield: One of the features we have developed is our buyer matching. We try to understand what each investor’s acquisition goals are on our platform. We ask them, what is your CDRE experience? What are your assets under management? What are your acquisition objectives in the next 12 months? They give us all this information and when a broker uploads an ad, we ask them to profile their offer. Where is the investor most likely to be? Is it a local buyer? Is it a national buyer, a regional buyer? What type of investor are you looking for?
Let’s say it’s a Florida asset. We clean our database for investors who have indicated they would buy based on these criteria, then we compare them immediately after publication.
We are very proactive and place these investors directly on the dashboard of this broker so that they can have an individual match-based approach.
Daily Grit: Commercial real estate appears complex as it is often a matter of zoning and permitting, with heavy local political and bureaucratic involvement. So I think commercial real estate is more clubby and local or regional. Am I, to what extent am I right or wrong about this?
Tabitha Satterield: People will definitely stick with certain asset classes unless there is a huge change in market trends. An example is industrial property. Amazon has different logistics facilities and they want to expand nationally, so people started saying, ‘Okay, something’s going on here and our regional mall is dead. I will start moving my money towards industrial (property).
We have international buyers, domestic buyers. Just because I’m sitting in Montana, maybe I like South Florida. So I will be very aware of what is happening in this market. And the accessibility of technology. I don’t need to be in this market to see trends. Do people move from New York, New Jersey to Florida? Is it housing they need there? Is it hospitality? Is it retail? And then as an investor, if I have an appetite for a certain class of assets, then I can find land to develop.
There are all kinds of different appetites for different types of real estate. It is not the same as “I need a house, this is the neighborhood where I want to live”. There is a lot more complexity and motivation for these asset classes.
Daily Grit: What are the hottest commercial real estate markets right now? I ask a question about geography, but is that the right way to think about it? Is it really a matter of asset class?
Tabitha Satterfield: It’s a bit of both. We look at how people spend time in their community. Do they go to regional malls? More really. Most people shop online. Michigan has a great example of this in one of its malls where big box retailers have moved. Now they have this big empty box and it’s horrible. So what can they do differently? Ford took a big chunk of this mall and turned it into an office. They created this place to work, play, shop and eat, all in the same establishment. It was a very interesting way to reuse real estate.
Daily Grit: What do you see happening with malls?
Tabitha Satterfield: It’s really interesting. People love curated shopping experiences. If a store feels “boutique,” people still want that experience. Malls willing to inject dollars to give it a facelift will have a better chance of surviving.
Some people just think of malls as land. Can we demolish this mall and build a parking lot? Or something like that.
Daily Grit: What emerging or overlooked commercial real estate markets are you in that may not be more generally known?
Tabitha Satterfield: The pandemic has definitely displaced many markets that were kind of neglected. Allowing people to work remotely has scattered a lot of people.
New York was a bit flat. People were like, well, why am I going to pay to live in this little box when my business doesn’t require me to come back to the office? This has made a big change in trends. Florida, Texas and Montana have seen huge growth. They didn’t have enough housing to support the people who came there.
Memphis is another good example to pay attention to. Ford moves a factory to Memphis. FedEx and Nike are already there. They’re going to need housing, they’re going to need retail, all the things you would expect from the community.
Another interesting thing is that KKR has just raised funds to turn office buildings in New York into housing. There are simply not enough units to meet the demand, but they currently have an occupancy rate of 40% (offices). So they raise a fund to convert and build more housing in New York.
Daily Grit: Does Biproxi raise funds?
Tabitha Satterfield: We will enter a Series A in early spring. But right now we are working on adoption at this stage. We just activated our paywall on December 1st. We are starting to convert our existing users and grow our user database.
But we will eventually come back to raise more money.
Peter Page is the Grit Daily’s Contributions Editor. Formerly at Entrepreneur.com, he began his journalism career as a journalist long before print media had even heard of the internet, let alone tear down the industry. The years he worked as a police reporter have a big influence on his view of the world to this day. Page has expertise in environmental politics, energy economics, ecosystem dynamics, the anthropology of urban gangs, the workings of civil and criminal courts, politics, the machinations of government, and the art of crystallizing thought. in writing.
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