Officespace.com Hones Business Model for Second Decade

Kip Spencer and John Suryan co-founded officespace.com in 1996. At the time it serviced only the Seattle market, tracking the daily inventory of space. Nine years later, it had expanded to service eight markets, but the founders wanted more—more revenue, that is.

To that end, Spencer and Suryan launched a redesigned site in June 2005 with more services that has to date proven successful. OfficeSpace.com reported earlier this month that 2005 represented its best year to date in terms of total sales, and that the fourth quarter revenue was 55% better than the same 2004 period. Thanks to new capture technology, its number of registered users also is rising dramatically.

"When we launched our redesigned site in June, our traffic basically doubled," Spencer says. "It stayed that way for a couple of months and then leveled off but is still 30% higher than it was prior to the redesign."

Much of the revenue growth is due to a new directory service that connects tenants to vendors who can outfit their office space, and a service that lets vendors know when tenants might need said services. Increased revenue is coming mostly from the vendors, who pay not only to be on the directory but to have access to information about which tenants may have an immediately need for services.

"We launched the directory after discovering that tenants weren't just looking to us for site listings but also as a resource for anything having to do with outfitting physical space," Spencer says. And in launching the directory, they found that vendors would pay not only to be on the directory but also to access tenant rosters and lease expirations.

Officespace.com doesn't gather lease expiration information, but has a program that alerts vendors when there is activity in a building--such as when a new availabilities are posted to the site--and then spits out a list of the tenants in those spaces. Vendors can also obtain buildings' tenant rosters as supplied to officespace.com by Dunn & Bradstreet, a service that also is well used by brokers.

Looking ahead, Spencer says additional service offerings are in the works as he and Suryan look to grow officespace.com into "a very large brand." To that end, Spencer says the company will "explore synergies with other entities."