This weekâs dot.LA Deep Dive delves into the stodgy but rapidly changing world of commercial real estate. Marina Del Rey-based Crexi is the new kid on the block, looking to transform the way buyers, brokers, and sellers do business.
Crexi, a commercial real estate (CRE) upstart, emerged on the scene in 2015, reshaping the CRE world with its blend of property marketplace, data platform, and virtual auction. Its mission? To build the simplest and most efficient one-stop-shop for CRE professionals. Crexi is the cupid of the real estate realm, connecting sellers of properties with buyers, and matchmaking the most efficient and effective transactions possible.
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Crexiâs origin story takes us to the early life of its creator, Mike DeGiorgio. Mike was a tumbleweed as a kid, growing up all over the country, which fostered an adaptability that later became a hallmark of his entrepreneurial ethos. Armed with a business degree from Northern Illinois University, Mike embarked on his professional journey at Irvine-based Auction.com, a tech enabled marketplace for bank-owned and foreclosed residential real estate properties. At Auction.com, he witnessed the elaborate waltz of property transactions, and, while there, he was struck by the fact that â while residential real estate was quickly jumping into the digital age, commercial real estate seemed stuck in a bygone era. The itch for innovation gnawed at him, and the concept of Crexi began to take shape.
His idea was a digital emporium in the truest sense of the word: a one-stop destination where CRE professionals could convene, conduct business, and make deals with just a click.
In 2015, Crexi emerged, a result of Michael's determination and a trio of co-founders who shared his vision. The path to success, however, wasn't a cakewalk. With a seed funding of $4.3 million from investors like Lerer Hippeau Ventures and Freestyle Capital, Crexi embarked on a journey to transform the commercial real estate landscape. Over the next five years, Crexi slowly but surely gained adoption across the CRE world, but in 2020, Covid struck and threw the CRE world into a state of disarray from which it has not yet returned. Like much of the financial world, CRE had a rough 2020 but roared back in late 2021 to a total of $1.43 Trillion (with a T!) in transaction volume. Higher rates have since put a damper on things, and transaction volumes have plummeted in late 2022 and early 2023 by 60-75% over the prior year.
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Luckily, Crexi was perfectly positioned to function in an uncertain market and grew through all of the ups and downs. Crexiâs value proposition has actually increased in the current market craziness. With asset values changing rapidly as the value of office space, distribution centers, and malls crash and rebound, Crexiâs data platform gives CRE pros a way to keep up. Additionally, in the event a deal goes sour, Crexiâs auction platform gives financial institutions an ability to offload properties quickly, easily, and to the highest bidder.
Fast forward to the present, and Crexi has emerged as one of the most resilient proptech companies in a brutal year for the space. It leads nearly three million buyers, brokers, and tenants through the intricate maze of CRE transactions, unlocking access to a whopping $5 trillion of property value. Crexi has facilitated transactions worth over $440 billion and continues to grow even during a challenging time for real estate.
So where does Crexi go from here? It just keeps on growing. Mike envisions a commercial real estate ecosystem built around Crexi, where properties are marketed, analyzed, and traded with unprecedented ease. It aspires to be the central hub of its industry, making commercial real estate accessible and efficient for all participants.
Over the last eight years, Crexi has grown from an idea to an integral part of the commercial real estate world. Itâs successfully surfed the ups and downs of Covid, work from home, higher rates, and the return to office. Next up, we expect to see more big things from Crexi.
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