Media

Entrepreneurs Building Photographic Memories
REAL ESTATE: Company uses images to settle questions over construction projects.

By Daniel Miller
Monday, March 29, 2010

Two real estate industry veterans have started a new Woodland Hills business filling what they say is a void in the marketplace.

The company, ConstructionPhotoDocs.com, creates photographic records of buildings during the construction process – a tool the founders say can aid in resolving disputes and insurance claims.

The company was started by Scott Yahraus, 30, and Andrew Weissman, 48, who both saw a need for such a service while working other jobs. Yahraus operated an energy consulting firm that specialized in multifamily properties, and Weissman worked for SunAmerica Affordable Housing Partners Inc.

Yahraus said that while developers, builders and investors already use photography to document construction progress, the results are often amateurish and inconsistent. And while there are mom and pop operations that offer a similar service, Yahraus boasts that no competitors have his firm’s online database. That system allows users to view hundreds of photos of a project, sorted by date.

The photos could be used to solve disputes on construction sites between builders and architects. For example, the photos could save a builder from having to open up a recently completed wall to verify that it was built properly. Similarly, if there are problems after a project is completed, the photos could either substantiate or refute insurance claims.

“This is the answer to, ‘If I only had a picture in the dispute, I would have won the argument,’” Weissman said. “Every time we talk about that, people recognize.”

Each project is photographed three to four times a month and on each visit as many as 500 photos are taken, in order to best document progress. The company has two employees and a handful of independent contractors that snap the photos.

The company charges a monthly rate that ranges from about $1,500 on the low end to $4,500 for a large project, such as a hospital. It currently has two clients, including residential developer McCormack Baron Salazar, which has hired the company to document progress of a housing project near MacArthur Park.

Auction Investment

AuctionPoint Inc., a Marina del Rey-based company that has created an online auction tool for commercial real estate brokers, has received a large investment from a San Francisco online real estate listing service.

The size of the investment from LoopNet Inc. was not disclosed, but Auction Point co-founder and Chief Executive Joe Tang said that it was substantial enough that LoopNet will have a seat on his company’s board.

The two companies also plan to work closely together, with the auction company gaining access to LoopNet’s national database of brokers.

AuctionPoint was founded in March 2009 and has a unique business model. Unlike other commercial real estate auction companies, such as Beverly Hills-based Kenney Wilson Inc., the company works directly with brokers, not property owners. The service allows brokers to create auction pages – similar to eBay – where properties are sold on behalf of owners. AuctionPoint makes money by charging a $395 set-up fee and taking 1.75 percent of the purchase price.

Tang said that the first auctions were done in September and in the fourth quarter 10 properties were sold.

Compton Deal

Logistics firm UDT Distribution Corp. has signed a five-year lease for new headquarters space in Compton. The Feb. 25 deal with landlord AMB Property Corp. for a 120,000-square-foot warehouse at 801 W. Artesia Blvd. was valued at $2.51 million.

James Min of Colliers International, who represented the tenant, said that his client was enticed by a teaser rate on the triple net lease offered by AMB, a San Francisco-based real estate investment trust.

The deal includes six months of free rent, after which the rental rate will be set at 25 cents per square foot per month for the remainder of the deal’s first year. The rental rate jumps to 39 cents per square foot per month in the second year and then escalates by one cent annually.

Min said he was able to get a good deal for his client because the property had been vacant for about one and a half years. The lease starts May 1.

UDT operates two facilities in the Compton area that will close once the company moves into its new space. The Artesia Boulevard property includes 10,000 square feet of office space.

AMB was represented by Todd Taugner of Klabin Co. He and AMB could not be reached for comment. UDT did not return calls seeking comment.