Start-up Urban Compass Aims to Drive Apartment Rental Online
New Yorkers take a strange pride in the difficulties of living in their city. But one hardship most would gladly ditch is the hunt for a rental apartment.
“It’s a nightmare,” says Ori Allon, an engineer and technology entrepreneur. “I found my apartment through a broker. I paid 16 percent and it took weeks.” That’s why Allon and former Goldman Sachs executive Robert Reffkin created Urban Compass, which plans to be “a 100 percent online solution” to renting and living in the city, says Reffkin. Of course, it’s not 100 percent online. One unique, offline feature, he notes, is the site’s use of real, live “local experts” who act as guides to the neighborhoods.
Urban Compass, which launched in beta on May 7 with an endorsement from Mayor Michael Bloomberg, offers a comprehensive database of available rentals, as well as extensive information about the surrounding neighborhoods—what kind of people live there, where to find bars, shops, schools—and handsome photos.
Once the visitor has found some likely apartments, she can book go-see visits online. (Think OpenTable.) The local experts—Urban Compass employees known as Neighborhood Specialists—personally show the apartments and the neighborhood to the prospective renter. Applications to rent and fees are all taken care of online.
There is no cost to search apartments or to view apartments with the Neighborhood Specialists, but the company does charge a service fee—“typically half of what other brokers charge,” says Urban Compass marketing head Andrea Bernstein—if someone rents an apartment through the site.
Rather than competing with landlords and brokers, Urban Compass is working with them, says Reffkin. “Everyone is our partner.” Thanks to those connections, Reffkin says the site has in its database about 90 percent of all rentals in the targeted areas—which at this point are Manhattan and parts of Brooklyn, with more New York neighborhoods to come later.
After the first phase of the site is running, Reffkin and Allon plan to unveil the Urban Compass Network, a platform that will allow renters to plug in to everything going on in their neighborhoods, connect with other residents, and take advantage of special offers from local businesses.