One of the big five commercial brokerages, Newmark, announced a new product this week. The corporate real estate tool, called Newlitic, allows users to create customizable dashboards that can help them keep track of things like occupancy utilization, portfolio and lease administration, transaction management, capital projects, and facilities management. The tool was built with Newmark’s extensive experience working with corporate clients and managing commercial properties. The brokerage hopes that the software will not only help their staff better do their jobs, but also become a revenue generator as they license it to other shops.
From a market perspective, Newlitic will likely jive with smaller brokerages/managers and corporate occupiers who are not able to develop this kind of program themselves. That said, it’s unlikely that Newlitic will get much buy-in from the other large brokerages, as the bug guys might be hesitant to give their data to a competitor. Plus, most of the other top brokerages already have a similar platform of their own.
Software is one of the highest margin products there is. With almost no variable costs, the ability to instantly ship upgrades, and the stickiness that comes with large amounts of data entry, software can be an incredibly profitable business. But we have yet to see a brokerage generate a significant amount of revenue from a piece of their software that they sell to the larger market. Newlitic could become a cash cow for Newmark, but that all depends on whether or not they can demonstrate that Newlitic is better than the other software in the market.