COMMERCIAL INVESTMENT REAL ESTATE JOURNAL - Internet Bids Up Auction Fever
By Ralph Spencer
As seen in Commercial Investment Real Estate Journal
Harrison & Bates, a Richmond, Virginia based commercial real estate firm, learned that lesson late last year when a client directed it to sell a downtown hotel at auction.
When the auction was announced in summer 1997, the John Marshall Hotel had been closed for 10 years and had attracted no local buyers. Harrison & Bates needed to pursue buyers nationally, so it teamed with Michael Fox International. Together, they decided to promote the property through print advertising in national publications, direct mail and professional networks.
An attractive, detailed brochure was posted on Harrison & Bates' Web site as an integral part of the promotional and sales effort. The company's representatives directed potential clients to the site, saving everyone time, money, and effort.
For potential clients, the Web brochure provided quick access to important information. They did not have to wait for overnight packages or view smudgy faxes. After visiting the site, they could form detailed questions and discuss them with knowledgeable staff. Potential clients then could decide if they were interested enough to spend the time and money to visit the property. For investment firms with several offices, the Web allowed teams at different locations to view the same material at the same time. Coupled with a conference call, this produced a powerful synergy for informed decision-making.
For Harrison & Bates, the chief benefit was time saved. Given the compressed schedule, the company needed every second. Several days lost in shipping materials might have kept potential bidders from participating. The Web also kept the deal alive until almost the moment the auction occurred. Two parties viewed the material 24 hours before the auction, came to the auction, and participated in it.
In the end, the Internet allowed the company to reach the largest possible audience in the shortest possible amount of time. No other advertising, transportation or communications medium could do this.
Because of Harrison & Bates' marketing effort, in which the Web played a prominent role, the hotel sold for $3.1 million in September 1997. The outcome was satisfactory to the buyer, the seller, and the commercial real estate professional involved in the transaction.
Ralph Spencer, CCIM, SIOR, is executive vice president of
Harrison &Bates, Inc., in Richmond, Virginia.