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Friday, Apr 19, 2024

Marcus & Millichap Gets Proptech Right

Proptech is increasingly important to the real estate industry, and Marcus & Millichap is hoping to lead the charge. 

The Calabasas-based brokerage implemented two new technologies into its communications system last year as it announced partnerships with both San Francisco-based Archer and New York-based EquityMultiple.

“For well over a decade now, investing in technology, both internal and external, has become essential to the commercial real estate business,” says Hessam Nadji, chief executive of Marcus & Millichap. “It’s very hard to ignore the importance of technology and how it affects all facets of commercial real estate now.”

Back in November, the firm announced its strategic partnership with Archer, a venture-backed real estate technology company that uses automation to accelerate market analysis and underwriting processes for its clients. 

Nadji calls Archer a “refreshing startup,” adding that “it makes the preparation of underwriting and execution of underwriting much quicker and much more efficient.” 

And just over two weeks later, Marcus & Millichap shared its new investment in EquityMultiple, a real estate financing and investment technology platform that allows sponsors and operators to connect with supplemental sources of private capital.

“Certain aspects of the business can be enhanced by joining forces with other proptech companies that have an entire business plan and commercial path toward a business they’re trying to carve that’s complementary to our core business,” Nadji says. “In the case of EquityMultiple, they’re so well known and have a great track record for helping sponsors that happen to be our clients come to market raising equity,” he adds. 

Nadji says the brokerage’s latest investments are nothing new. He says the company has been forward-thinking since its founding by George Marcus and Bill Millichap in 1971.

In fact, Nadji, who studied computer science as an undergrad at City University of Seattle, revealed that the company’s prioritization of technology was a major influence in his own decision to join Marcus & Millichap, which he did in 1996, first as the head of research and advisory services.

“Bill Millichap in particular really took to the notion of modernization and automation of traditional brokerage through technology,” Nadji says. “The notion of investing in technology and using it for our business model is very much in the DNA of the company.”

In 2022, the company launched MyMMI, an internal, customizable brokerage tool that automates perpetual matching of investors’ property-search preferences with the firm’s exclusive listings. Today, the firm has more than 100,000 investors registered with MyMMI.

But despite its steep technological advancement, Nadji says Marcus & Millichap still plays it cautious when deciding on new investments. 

“We’ve been pretty selective in the way that we partner with different technology providers,” Nadji says. “We’re looking at other business lines that we do believe will be supplemental, like appraisal and consultation, like investment management,” he adds. “Those have really good correlations with our core business. And we’re exploring multiple opportunities in all those areas.” BRYNN SHAFFER

James Brock
James Brock
James Brock has worked in newsrooms around the world, including in New York, Paris, Abu Dhabi, Dubai, Houston, and Los Angeles. He began his career with a Newhouse News daily, where he served on the news desk and the editorial page. He was the copy chief for The New York Sun, and founded and edited the personal finance section for Abu Dhabi-based The National, among other positions. He has interviewed Anthony Bourdain, Tom Ford, Mark Cuban, and many other individuals, and has written and edited thousands of stories and articles.

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