1. www.LoopNet.com John Wood (jwood@loopnet.com) Vice President Appraisal Information Services LoopNet, Inc. August 24, 2001 Knowledge SpeedReachRelationships Commercial Appraisal Data …..…..…who has the best?

2. www.LoopNet.com The New LoopNet … PropertyFirst & LoopNet merge March 2001 – Intent to merge announced July 2001 – Merger complete New company operating under LoopNet name No. 1 online commercial real estate community 150,000 listings / 225,000 users / 300,000 visitors per month September 2001 – New LoopNet website launches

3. www.LoopNet.com National, online, appraiser-verified data cooperative Appraisal Institute members are exclusive data contributors Access to comparable sale, lease, and income/expense data Based on Appraisal Institute Commercial Data Standard Exclusive Appraisal Institute Members Benefits: –Preferred Pricing, Revenue Sharing, and Leads Unprecedented access to technology on one desktop application It’s an appraisal system that’s been built for you! The Appraisal Institute Commercial Database … what is it?

4. www.LoopNet.com A common language for comparable data Initial version released May 2001 Widespread interest –Distributed directly to over 250 entities, fielded another 300 requests Gaining acceptance & adoption –Data Consortium –Leading Firms Enhances electronic data interchange Speeds technology adoption Appraisal Institute Commercial Data Standard … a foundation for growth

5. www.LoopNet.com Assignment Management System – your “virtual” office FastStart System – jump-start your appraisals Private Company Database – share data seamlessly Appraisal Institute Commercial Database – finally, we can come together and leverage our collective strength LoopNet’s Appraisal Initiative …more than just a database! It’s Appraisal Technology for the 21 st Century

6. www.LoopNet.com Attachments Images – Pictures, Images – Pictures, Tax Maps and more Tax Maps and more Documents – Rent Documents – Rent Survey, Rent Roll Survey, Rent Roll and more and more The Appraisal The Appraisal Virtual Assignment Folder … the starting point Subject Property Data Property Level Property Level Sales Sales Leases Leases Income & Expenses Income & Expenses Comparable Information Land Sales Land Sales Improved Sales Improved Sales Leases Leases Income & Expenses Income & Expenses Leads ++

7. www.LoopNet.com Assignment Management System … your own “virtual” office

8. www.LoopNet.com Pre-Populate FastStart System … data & tools to jump-start appraisalsDemographics Marshall & Swift Shopping Center Traffic Counts And More……. More Data Mapping Property Tax Record Database PrivateCompanyDatabase LoopNet Listings Database

9. www.LoopNet.com Once Logged into the system, all of your active assignments will be listed here. The listing is then a link to access the data records in the assignment folder.

10. www.LoopNet.com From within an assignment folder, you can access the Subject Property and comparable data records.

11. www.LoopNet.com Yesterday’s Listing Is Today’s Subject Supports the Next Day’s Listing Becomes Tomorrow’s Comparable Data Cooperative The Virtuous Cycle of Data Brokers, Owners & Tenants Appraisers & Lenders

12. www.LoopNet.com Public records Thin information Information on sales only Internal researchers Costly Third party data venders Costs Reliability Dependence issue Sharing with other appraisers Informal – the “old boy network” Formal Appraiser Data Cooperatives Appraisal Institute Commercial Database What is the best source of comparable data?

13. www.LoopNet.com Confidentiality Issues What does USPAP say about confidentiality? –An appraiser must protect the confidential nature of the appraiser-client relationship. –An appraiser must act in good faith with regard to the legitimate interests of the client in the use of confidential information and in the communication of assignment results. –An appraiser must not disclose confidential information or assignment results prepared for a client to anyone other than the client and…( persons specifically authorized by the client; state enforcement agencies; and professional peer review committees, etc.) …

14. www.LoopNet.com Confidentiality Issues What does USPAP say about confidentiality? Client engagement letter issues

15. www.LoopNet.com Confidentiality Issues What does USPAP say about confidentiality? Client engagement letter issues Gramm-Leach-Bliley Act –Generally not applicable to commercial transactions –Over reaching by bank legal departments

16. www.LoopNet.com Data Ownership and Usage Rights Issues Who owns data? –Data Vender? –Property Owner? –Appraiser? –Client (lender)? Copyright Issues –Copyright law protects the expression of creative works. To qualify for copyright protection, the expression must be an original work of authorship, which requires that the work be independently created and possess some minimal level of creativity. Contract Rights

17. www.LoopNet.com With data becoming more readily available, how do appraisers add value? Client Needs: Broader services and products Competition: Encroachment from CPAs, MBAs and others Lender Concerns: Appraisal cost, timing and review process Securitization: Tools and data for collateral risk assessment Standards: Need for global data and technical standards Technology: Prospective young professionals are use to and demanding state- of-the-art technology and tools Who Moved My Cheese? … adapting to change

18. www.LoopNet.com Thank You