McKinney’s innovation fund has attracted a tech startup to the North Texas city’s historic downtown that ambitiously describes its product as “a Bloomberg terminal for real estate.”
Spatial Laser is a property technology firm that helps professional real estate buyers find and evaluate single-family investment properties using data and machine learning. It’s the 21st company drawn to McKinney’s expanding tech cluster.
CEO Steven McCord had worked in real estate research for almost a decade when he realized the analytics and data that went into his commercial real estate research were missing from the residential real estate world. He came to that conclusion while looking to buy his own investment properties.
“I would spend weeks just sifting through the data because that’s what I like to do,” he describes. “I thought, ‘Well, nobody else would have time to do this.’ If they want to figure out the same results that I did, there needs to be software to do that for them. This was something that was begging for some simplification and automation.”
Spatial Laser aims to help companies wanting to buy a large number of residential investment properties in a limited amount of time by collecting and simplifying market data.
The firm’s primary product is Locate Alpha, which seeks to replace the hunches that typically guide real estate investments with plentiful data. Investors can view property listings overlaid on heat maps of supply, demand, risk and performance indicators like estimated appreciation, property tax rates and five-year returns. Users can also view a “report card” of any location at the city block level.
McCord said the product’s name comes from the firm’s desire for “alpha”-level investment returns.
“Our big goal here is about improving transparency in the market, improving market efficiency and making the whole process of researching where to buy a lot easier because there’s a lot of data out there, but it lives in a million different places,” he said. “Most of the time, it’s going to cost a lot of money and a lot of time to try to combine those things in a meaningful way, and we’ve done that for them.”
Single-family rental housing is one of the hottest trends in real estate markets across the country as more investors become interested in building or buying homes to rent. McCord thinks his software can help investors target key areas in North Texas.
“While Dallas-Fort Worth overall is a great market to invest in; now the question is, where specifically do I go?” McCord explained. “Which areas are better? Which areas might be falling behind? I want to know that as an investor.”
Spatial Laser is moving from its current offices in Plano to downtown McKinney, located in the Common Desk co-working space at 300 East Davis Street. The firm has three employees and raised $280,000 in capital, but McCord said he’ll add hires and continue to grow in 2022.
Mike DePaola, director of technology and research at the McKinney Economic Development Corp., said Spatial Laser is a welcome addition to McKinney’s tech scene.
“When we first demoed Locate Alpha, we were blown away by the detail provided and easy to navigate UX,” he said. “It was a no-brainer for us to partner with such talented individuals.”
The economic development agency uses an innovation fund supported by a one-half-cent sales tax to attract tech startups to the city. It collected more than $14.2 million in sales taxes in the 2019-20 fiscal year.