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PropTech Today: Why doesn’t Rightmove create its own co-working business?

I loved my Foxtons office. I started in the Battersea branch. It was the old-style office; traditional carpets, actual properties in the windows for people to stare at as they passed and it smelt slightly damp.

I went to open and expand the Putney office after a year. I saw it evolve from the old-style to a brand new sparkly one with a coffee machine, free fizzy water and fancy coffee. I was proud to work there and even prouder to see the evolution of the high street estate agency as others followed suit. 

We became a collective of estate agency bars rather than offices. People would often walk in and mistakenly ask for a coffee thinking we were a cafe. 

Foxtons set the trend for fancy offices. Some followed the trend; others most certainly did not.

This was nearly 20 years ago and it was a time when the office still mattered; it had a purpose. It was key to maintaining lead generation, branding, culture and local reputation. 

Foxtons stood out from the crowd and people wanted to visit just to see what the experience was like (and to get a fancy coffee). Rightmove, Zoopla and the rest hadn’t got a stranglehold on the market at this point - we still generated our own leads. 

Does the office really have a place today other than to be the ultimate (and very expensive) water cooler? A place for people to gather, chat through their deals and have a good old-fashioned banter about how ridiculous a particular vendor or landlord is. 

Shouldn’t we be looking at alternatives? Take the huge surge in valuations of businesses like WeWork ($20billion at the latest valuation and soon to be even bigger) as an example business model that offers an alternative. 

WeWork is now the largest occupier in London after the government - leasing over 2.6m sq ft since 2012 and though I am not the biggest fan of its brand, its growth cannot be argued. 

WeWork is now synonymous with this trend for co-working; a larger company takes on the long lease, fits out the space and then sublets it to a number of companies that want the flexibility of shorter leases and none of the hassles of being an occupier. 

I remember, at least three years ago, sitting down with someone at Rightmove, who shall remain nameless, and suggesting that surely this could be of interest to them. One of the largest costs of an agent are the offices that act as home for their largest cost, the staff. 

If portals own the applicant market, what is the real need for every high street to have multiple numbers of estate agency offices other than offline #PropertyPorn for those that have had a long lunch or those that are out very late (people must be drawn to those fancy LED property particular boards that are low on energy output, high on nighttime visibility)? 

Perhaps the push back is that an agent needs a presence to help secure valuations. Some will tell me I am wrong, I’m sure, but I would suggest that most valuation requests occur online now so again this raises the question of why an expensive high street presence is needed. 

Either way, it seems the portals may be looking at both digital and analogue solutions to help agents move forward. Recently  we saw Zoopla purchase Ravensworth so maybe they could be interested in going one step further. 

Why don’t Rightmove or Zoopla really help agents cut costs (perhaps then they’d be able to defend their charges going up so much) by setting up hub offices where agents can work from for a minimal fee (or for free)? 

Perhaps these could be in more central towns and cities to support wider geographical areas. Perhaps they even have beer taps like WeWork does; though I would fear what that would do to the economics of the resultant business!

What about the suggestion of Rightmove Rooms or the Zoopla Zones? Who can think of any better ones? Answers below in the comments if you can be more creative.

Either way, given the valuation size of WeWork, perhaps this is a way to further line the pockets of investors given the limited scope of their current business model (or one of them anyway) to future trends and changes of how agents will obviously need to work. 

It may mean that the net profit margin, so often quoted, would be impacted, but perhaps this may help both sides of the market for once?

*James Dearsley is a leading PropTech influencer and commentator. You can follow him on Twitter here.

  • Peter Grant

    Wouldn't that mean that the staff could be employed/contracted by Rightmove or Zoopla in the "Portal Places" and that we then just have two enormous Estate Agents offering a hybrid model ? #pennydrops

    James Dearsley

    Certainly there is a discussion to be had around that Peter. Equally, the 'independent' broker model of the US/Aus (and some other countries) becomes more of a reality too - maybe not RM or Zoo but other larger agencies seriously look at their models and develop something on this line.

     
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    I think that's a powerful idea, James, really really powerful.

    James Dearsley

    Doesn't have to be Rightmove. Could be anybody......but someone has to ask themselves the question about what is sensible in this economic environment

     
  • EuGin Song

    Our current MO but still need an office for keys and team meetings mainly so serviced office fine. <2% of our tenants owmers ever visit our office.

  • Simon Shinerock

    Tongue in cheek James? I had a seekers franchise in Putney in 1988 and witnessed the Foxtons evolution, seekers were the Purple Bricks of their day, where are they now? For what it’s worth I think High St offices will be more important in the future as they become rarer. I’m really looking forward to our competition going to WeWork so we can pillage their market share 😎

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