REITs enhance their business of connecting with customers via the Internet

By Jennifer D. Duell

From cell phones to the Internet, technology has had a huge impact on the way almost all companies, including REITs, conduct business. For REITs in every sector, Web sites have emerged as one of the most effective ways to connect and interact with customers, from teenage girls to Fortune 500 companies.

In fact, REIT Web sites have become part of companies' strategic mission, growing beyond the purview of the IT department and gaining attention from the highest levels of the company, says Melissa Libner, head of marketing, SL Green Realty Corp. (NYSE: SLG), a New York City-based office REIT. "Our CEO, Marc Holliday, really had a vision for making the Web site reflect our mission of service-intensive building management," she says.

Moreover, Web sites are helping REITs achieve strategic objectives and are taking leading roles in marketing and operations. Additionally, REITs are constantly making their Web sites better, rolling out new versions with helpful tools and features.

Streamlining Business Processes

SL Green launched its newly designed Web site in December 2007. Previously, the site was investor-driven, but the new version is more tenant-centric, Libner says. "We saw an opportunity to create a portal for our clients—the tenants in our buildings," she says. The REIT also wanted its Web site to appeal to the real estate brokerage community that represents its tenants.

For SL Green, one of the main benefits of the updated Web site is that it streamlines the business process. For example, tenants can use the REIT's Web site to submit property management requests and access the tenant handbook. "We're creating convenience for our customers with the Web site, and we want to do anything that will alleviate the need to pick up the phone or write a letter," Libner says.

Similarly, Santa Monica, Calif.-based Macerich Company (NYSE: MAC) brought its entire tenant leasing package online to target retail tenants, its main customers, along with the shoppers who frequent its malls and lifestyle centers. From design guidelines to rules and regulations for each mall, retailers can download and customize their own tenant package, according to Traci Weber, vice president of brand planning for Macerich.

Simon Property Group (NYSE: SPG), the largest REIT by equity market capitalization in the United States, also uses its Web site to provide information to retailers and retail brokers. The REIT provides leasing information for existing centers, and retailers can also view the projects that Simon has under development. This information is especially helpful to new tenants that are unfamiliar with Simon's properties, says chief marketing officer Stewart Stockdale.

Simon's Web site also serves as a strong property management tool, Stockdale points out. For example, the REIT posts each retailer's local property tax bill online, rather than sending it via overnight mail. "The Web site has cut weeks out of the process," he says.

Educating Customers

For most REITs, Web sites are a convenient and efficient way to educate customers, especially those like San Francisco-based industrial REIT AMB Property Corporation (NYSE:AMB) that have global operations.

"Our Web site is designed to be a robust and dynamic electronic brochure that provides both current and prospective customers with information about AMB's global platform and capabilities," says Margan Mitchell, vice president of corporate communications for AMB.

"Many of our customers are moving goods through major seaports, airports and distribution hubs. As the supply chain lengthens, customers look to AMB for property solutions. Our Web site is designed to help them find space that meet their needs, either through existing space or development."

Likewise, BioMed Realty Trust (NYSE:BMR) has set up its Web site to provide specific information to potential tenants regarding vacant space and building features. The San Diego-based medical office REIT also includes e-mail contact information on its Web site so current and prospective customers can connect with the REIT at their convenience.

Providing Search Tools

Many REITs have added interactive maps and search functions to their Web sites in an effort to help their customers. Macerich, for example, asked customers what they wanted in a Web site, then developed a new design and navigation features around its findings.

"We have put a lot of time and effort into developing interactive maps for our shopping centers," Weber says. "These maps are a more effective and simple way to plan the shopping trip." The REIT's online maps enable shoppers to navigate through each center, searching by store name or type of merchandise. Based on the customer's search parameters, the Web site will pull up different locations within the centers. Macerich also worked with Google to create customizable directions.

Denver-based apartment REIT UDR, Inc. (NYSE: UDR) also did market research to determine what apartment renters want in a Web site, conducting online surveys and focus groups to create a customer-driven site, says Vice President of Marketing Steve Tarabelli. "When renters come to our site, they have high expectations of what an online user experience should be, and we are meeting their expectations and needs by giving them a superb online search experience," he says.

UDR's Web site enables prospective residents to search for apartments using a number of search parameters, ranging from location to number of bedrooms. The site is fully translated into Spanish and offers live online chat assistance. Additionally, the REIT's Web site has a virtual apartment configurator, which enables customers to experiment with different furniture arrangements.

Like UDR's site, "do-it-yourself" tools figure prominently on Extra Space Storage's (NYSE:EXR) Web site. When customers visit Extra Space's Web site, they can search for storage units based on size and location. The Salt Lake City-based self-storage REIT also offers a space calculator online, which assists customers in making decisions regarding the size of the unit they need without calling the company's help line or the property directly. The Web site also links directly to the REIT's operating system, so unit pricing and availability are offered in real time.

The space calculator tool, along with the real time pricing and availability tool, has made it easier for Extra Space Storage to convert Web site visitors to customers, says Buck Brown, senior vice president of marketing and sales. "We've seen a lot of growth in customers who are willing to go ahead and give us a credit card online to hold that unit and lock in the pricing," he says. "A couple of years ago, people wanted to visit the property and walk a model."

Reservations are also a key element of Strategic Hotels & Resorts' (NYSE: BEE) Web site, says Jon Stanner, an associate with the company. When customers visit the Chicago-based hotel REIT's Web site, they're able to search the company's 20 properties and make reservations. However, Strategic Hotels doesn't host the reservations system directly on its Web site. Instead, it links to the sites for its hotel brands. For example, when travelers click on the link for the Four Seasons Hotel Mexico City, the link takes them to the Four Seasons Web site.

"Travelers are more likely to go to the hotel brand Web site versus the hotel owner's site," Stanner contends. "It's a collaboration between us and the third-party hotel management companies to make the process as seamless as possible, so travelers can get all the information they need about our hotels and then make reservations."

Maintaining Constant Contact

Conveniences aside, many REITs have created Web sites to maintain constant contact with customers. SL Green's Web site, for example, enables brokers to create an online profile and flag certain pages. Brokers can use the site to track buildings within SL Green's portfolio, and the Web site has an automated function that enables them to sign up for e-mail updates on properties that they flag as favorites.

Likewise, Simon's Web site enables customers to sign up for special promotions and events. "We'll e-mail our customers to alert them when their favorite store is having a sale or when we have a concert at one of our properties," Stockdale says. Simon's Web site also gathers shopper information, and these data help the REIT provide targeted marketing messages for its retailers. Currently, the Simon Web site is attracting approximately 3 million unique visitors per month.

Macerich, meanwhile, has launched a new e-style program to develop an ongoing relationship with shoppers, Weber says. The program enables shoppers to sign up so they're the first to receive information about new stores, new properties and, perhaps most importantly, sales. "We've discovered that our shoppers want this information first, and they want it to be meaningful," she says, adding that Macerich's shopper database grew by 30 percent from 2006 to 2007.

For its part, UDR allows prospective and current customers to opt into RSS feeds, which will notify them if there are any changes to the UDR site. "We're doing our best to make it very easy for an apartment renter to do business with UDR," Tarbelli says.

And that's the goal for all REITs—for their Web sites to make it easier for their customers to do business with them. The challenge for REITs, according to Libner, is to move beyond the existing Web site and think about the next version. "Web sites are always a work in progress, and they require a team effort from every part of the organization," she says.

Ultimately, the Internet has made REITs more accessible to their customers, enabling customers to initiate contact with REITs on the customers' terms. REITs, like other businesses across the globe, have embraced the Internet, realizing that their Web sites are working for them 24-hours a day, 7-days a week.