Seattle startup CityBldr is breaking new ground, boosted by fresh funding from undisclosed investors.
The startup’s chief executive, Bryan Copley, isn’t commenting on the investment but SEC documents reveal CityBldr has raised $2.9 million of a $3.4 million round. The funding comes as CityBldr prepares to open an office in Los Angeles and expand its product offering to cities throughout California. The investment is likely tied to a new partnership with the commercial real estate behemoth JLL announced this week.
CityBldr uses software to unearth the hidden value of land, a tool that allowed these seven neighbors to sell their homes to a real estate developer collectively, earning more than they would have through individual sales. Operating as a real estate broker, CityBldr contacts property owners with underutilized land and connects them with buyers, retaining a fee. JLL brings brand recognition, cache, and a valuable rolodex to the equation.
“JLL has been building that relationship with investors, builders, and developers for decades,” Copley said. “So they know all the people who are looking for certain sites, they’ve got relationships with them, they’ve done lots of deals with them. And one of the things that we found is that even though we were surfacing great deals, we didn’t have those relationships … and it was impossible to fabricate decades of relationships in months.”
This week, CityBldr also announced prominent Seattle real estate developer A-P Hurd will join the company’s board of directors. Hurd stepped down from her role as president and chief development officer at Touchstone earlier this year.
Initially, CityBldr was focused on residential properties but now has expanded its service to cover nearly all types of real estate.
“What we’ve learned is our machine learning algorithm doesn’t care if its a house, or an apartment, or a gas station, or a vacant parcel of land, or a commercial building, or an office building … it doesn’t care at all,” Copley said. “It just sees that there’s opportunity in that land and it predicts the highest and best use of that land.”
CityBldr is hoping to hire a team of about seven in Los Angeles and bring on an additional 15 to 20 employees across its offices. The company has also begun meeting with public officials to discuss how the software could be leveraged by cities and counties to create affordable housing.
In the Seattle area, CityBldr is brokering a deal with seven homeowners clustered around a future Light Rail stop. The total of each home’s market value is about $3.2 million but collectively they can sell to a developer for around $7 million, Copley said. The land would go toward a 260-unit housing development.
“What’s really exciting about that is the 260 units that will be yielded from those seven units means not only 253 more homes in a supply-starved environment where there’s not enough homes for everyone,” he said. “All of those homes are 200 feet from the Light Rail station coming in. So the people that move into those properties won’t need cars, which we think is awesome.”
The new funding is CityBldr’s second investment round this year. The company has already raised $1.6 million from investors like real estate developer SRM, Start It Labs, Millenium Global, PWR Financial, Realogics Sotheby’s, and TUNE CEO Peter Hamilton.