Streetsmart Deals Real Estate Market Data

In a booming market rife with billions in real estate speculation, reliable information is worth a king’s ransom.
That’s one reason Sherryl Barger, Jeff Collins and Tom Reed have partnered to form Streetsmart Data Services Inc.
The group will offer lenders, developers and Realtors a connection to the best available information on the streets and about the streets of Northwest Arkansas.
They’re even going to help their customers learn how to put the data to good use.
Reed, owner of Real Estate Market Data Inc. of Springdale, and his employees have offered the semi-annual Reed Report — a roundup of residential, commercial and multi-family market data — to clients in one form or another since the mid-1990s.
Collins and Barger are former employees of the University of Arkansas’ Center for Business and Economic Research, which among other things produces the Skyline Report for Arvest Bank Group Inc. The two developed the initial format and research parameters for the report about four years ago.
Collins, former director of the CBER, has been the most visible economist in the state for the last several years and was frequently the keynote speaker at economic forecast events.
The guts of the data generated by the Skyline Report are proprietary to Arvest and its customers, though the bank has shared broad summaries with the media since the second quarter of 2005.
The Streetsmart trio will soon headquarter in Fayetteville and has already started to combine the best practices of both reports into a beefed-up quarterly Streetsmart Report available to anyone willing to buy it.
They wouldn’t say how much the information will cost.
“There will be different pricing for different levels of participation,” Reed said.
Arvest has paid the CBER more than $250,000 for the last two years to research the Skyline and paid $147,431 for the first study done in 2004-2005.

Custom Customers
Reed said customer demand will drive the types of information the firm collects in the long run, and Streetsmart will seek ways to add value to whatever they do.
The partners are still talking to potential clients and transitioning some of REMDI’s clients into new contracts, so they wouldn’t talk about what companies have signed on. Reed and Collins did say they’ve made presentations to about 12 banks since January and response has been favorable.
The trio said it’s also planning on taking Streetsmart to a few select underserved markets outside the state and even to central Arkansas. They wouldn’t talk about details, but the expansion move is already under way.
Prime customers for the company would be new and new-to-the-market banks. Newer banks tend to make slightly riskier loans or loans with slimmer margins to generate business.
For many bankers, knowing specific details about the market can help avoid bad loans.
“We’re thrilled about the opportunity to work with those guys,” said Gary Head, chairman and CEO of startup White River Bancshares Inc., the holding company for Fayetteville’s Signature Bank of Arkansas. “The more mistakes you can avoid, the better.”

Robust Reporting
Reed and Collins admit the Reed Report wasn’t user friendly. The data was there, but customers had to dig through tabulated charts for specifics then interpret the meaning on their own.
The new report will have more graphical presentations of trends and, perhaps most importantly, provide summaries and market analysis by Collins, who has a doctorate in economics from the University of Tennessee.
Collins said the report also will have some projective statistics about area job creation and market sustainability.
“It’s one thing to know the data,” Collins said. “And something else to know about the demand side.”
Streetsmart is exploding every avenue to make the report a must-have.
The company will train customers about the market, teach end users how to read the report and offer a service to make presentations.
Contracted custom feasibility studies are on the horizon.
There are even plans to hold paid-admission events so the team can present partial findings to a broader audience than its contracted clients.
Barger said the first event could be as early as the second quarter.
Streetsmart has plans to provide even more coverage in the three major areas where it collects data:
In the residential market, Streetsmart will collect data on empty lots, homes under construction, complete but unoccupied homes and on occupied homes. Unlike the Skyline, they will also collect data on building starts and the time it takes for houses to move from one category to another.
They will also be able to provide price points in active subdivisions in all major towns and bedroom communities, including Bella Vista (currently not researched by the Skyline).
“I think you can dig deeper and look at what drives absorption, and even deeper to see what amenities drive absorption,” Collins said.
The group will add townhouses and condominiums to its data on vacancy rates and price points for apartments in the multifamily market.
For the commercial market, they will collect data on the same categories in the Reed Report (office, medical office, office/retail, office/warehouse, retail, retail/warehouse and warehouse), but also on the hotel/motel market and on restaurant activity.
The team will continue to use many of the same research tactics employed by the Skyline, including the labor intensive “drive-by.”
Barger said someone will drive by all 21,000 lots in the 300 subdivisions the firm tracks.
“You have to go out and physically look at them,” she said. “A builder may not want to tell you his house is sitting there complete and unoccupied.

Market Need
Collins, Reed and Barger believe Streetsmart’s data will help clients directly by enabling them to make better decisions about development. They also hope it will eventually elevate the region if enough financial institutions and developers use the data.
To that point, some people have criticized Arvest for releasing only summaries of the Skyline Report. Kathy Deck, the new director of the CBER, said the report has always been about providing information where there previously was none.
An Arvest spokesman said there have been signs the market has made positive corrections based on the Skyline summaries and pointed out the report is actually a database.
When Head was president and CEO of Arvest Bank-Fayetteville, he was one of the original initiators of the Skyline research with Collins.
At the beginning, he said, Arvest management always believed the cost of the report equaled the cost of one bad loan, so any good decisions made based on the data was money saved for the bank.
“One reason markets fail is because not everybody has the same information,” Collins said.
Streetsmart plans to make sure that doesn’t happen in the Northwest Arkansas market.