| US information provider Costar buys UK-based Propex |
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Interview with Paul Marplesformer director of Propex in London, now director of Costar Europe
by Marinus Dijkman, President, Editor-in-Chief Europe Real Estate, |
 Marinus: I am here with Paul Marples, former director of Propex in London, now director of Costar Europe. Paul, the news is that Propex, the leading property trading platform in the UK is sold to North America’s biggest property information provider Costar. Why?
Paul: Propex is being faced in the UK for 5 years now, launched in 2000/2001 and has grown and become a profitable business and is very successful in the UK, but we were increasingly finding that our clients in the UK needed access to the continental European market. There was a strong demand from them for us to provide the platform investment in a bigger arena. The size of the company was such that it was going to be very difficult to do that without further capital and so we looked at a number of different ways about raising capital. During that period we came across Costar and decided in the end that the right route was actually to sell the business completely to Costar, particularly because Costar have just started their aim to expand across Europe. So these two things were tight and pretty needed at the same time. After a number of months of discussing with them I decided that the best thing is to actually sell out and to work with them to allow us to now expand our services across Europe.
Marinus: Thanks Paul, but what are Costar’s plans for Europe and what is your role in it?
Paul: Costar has been going for 20 years. It’s a business that’s publicly quoted on Nasdaq. They have a market capitalization of just under 1 billion dollars, a profitable business and their business model is really very simple. They collect very deep information about individual properties at a property level basis, so they track in the US 2 million buildings and for these 2 million buildings they collect information on every lease in the building, every available space in the building and when it gets sold they track the pricing of it and so over the 20 years they have built a very deep level database of those buildings and the plans are very simple. They would like to replicate that model across Europe. So they started in London first, where they initially focused on a London base and provided information on availability in and around the whole UK and deals data and the plan is for that to be now expanded for the Costar very heavy research to be brought into the United Kingdom and that will then be rolled out over time across Europe with the Propex Investment platform sitting on top of it as a transaction level. So the idea is that investors transacting use Propex and then drilling down into the property level data and information that Costar is providing through its research vehicles.
Marinus: What is the advantage of having property level data for the market?
Paul: When you see what they do in the United States you see the huge advantages to investors. In the US there is really pretty much full transparency now and information at a building level. So if you are an investor, the ability to make objective decisions quickly and accurately is such, that there are huge increases in the speed of transactions, it’s much more efficient, much cheaper to make valid decisions. So I guess it’s like in any market as soon as there is true transparency, actually it means level transactions increases and everybody does a lot better. Whilst in continental Europe here we have traditionally been a little bit cautious about releasing information , brokers have felt that holding on to information gives them competitive advantage. I think we have seen pretty much in all the capital markets in the world now, other than property today, that actually as soon as that breaks down and there is transparency in fact everybody gets better out of it. It’s happening in Europe. Over the past 5 years there has been more and more transparency and I think it is an ever accelerating trend there.
Marinus: Coming back to the question: What is your role in it and can you tell me more about yourself?
Paul: My background is that I am an investment broker. I spent ten years as somebody who is buying and selling investments both in London and in Europe. I was 5 years working in the Madrid market. Then I joined Propex 6 years ago and gave up my role as investment broker about 4 years ago and have been running Propex ever since. My role now within Costar is to help and assist in the expansion of their product across Europe, starting in the UK and building that out across Europe over the next few years. So you might be seeing quite a lot of it, I hope.
Marinus: I wish you luck and thank you for your time.
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