CoStar Real Estate Manager Taps New Leader
by Justin Rubner on December 7, 2023If you were in charge of a high-performing, market-leading organization for 23 years and were to pass the torch to a new leader, you'd probably want the following:
- Someone who understands your product and market better than anyone.
- Someone in tune with customers.
- Someone with diverse experience within that organization.
- Someone with demonstrated leadership skills.
He most recently served as Vice President of Strategy and Customer Success. He's also held roles in Sales, Implementation and Product. Overall, McDonald worked at CoStar Real Estate Manager for 15 years.
In his new role, McDonald will focus on continuing to profitably grow the Costar Real Estate Manager customer base, while further strengthening CoStar’s product leadership position in the real estate administration and lease accounting markets.
When recommending his successor, Thomas reflected on McDonald's broad experience within the company. "Mark had deep experience with our customer base and understood our products and market extremely well. [When he] came in, he was doing customer implementations, he then worked in product for a period of time, he was our first sales engineer, and Mark served as interim head of sales for a period of time, as well. When we were ready to start the Customer Success Team, I tapped Mark to build and lead it."
"And he went to Georgia Tech. That was a requirement," Thomas jokes.
Customer and employee tenure
When looking at the stats at CoStar Real Estate Manager, there are two that are particularly impressive. High customer retention and low employee attrition.
So, what do Thomas and McDonald attribute to such a long-standing tenure?
Thomas left a book - along with a bottle of scotch - behind in the corner office for McDonald with a poignant quote, "The value your customer places on your relationship isn't defined by your product's features and function; it's defined by everything else your company does to help make your customers better at what they do."
That sentiment, carried from one leader to the next, answers the question of customer tenure.
"We’ve had customers who have been here longer than me," McDonald says. "Our tenure is unique in this industry. Of course, we continue to listen to them and add the value they need. But it all goes back to the people part. We’ve had tenure and stability in leadership. Andy's created a culture and a place where people want to work and show up."
"We always had a focus on customer success whether we called it that or not," Thomas adds. "We always made sure we had the best product (which we do), we presented our product fairly and accurately, and no matter what the circumstances, we always made sure the customer was getting what they needed in order to be successful ... Customers aren't companies; customers are people."
Customers aren't companies; customers are people.
Former President, CoStar Real Estate Manager
When it comes to employees, the same ideals stand true.
"Well, we'll see how it goes without me there," Thomas joked, "[But] we started with good hiring, hiring good people."
Both McDonald and Thomas gave the example of the many so-called boomerang employees who left CoStar Real Estate Manager and returned.
"I told Andy at his retirement party that I feel like I grew up here," Ari Heredia-Lopez, a boomerang employee, shares, "The biggest reason I returned is the people. We have such a good group of smart, driven people, and it creates a great growth environment. If you want it, the opportunities are here."
"Treat people fairly and honestly and give them opportunities to grow," Thomas finishes succinctly.
The ASC 842 run-up
Coming up with a favorite moment for a 15-year tenure might be difficult for some. But McDonald doesn't hesitate to mention the entrance of CoStar into the lease accounting market.
CoStar Real Estate Manager was the first mover in 2016, using its years of lease administration experience to deliver a solution to meet new ASC 842 standards.
The culmination of what we did as an organization in that timeframe was exciting. Building a solution. Educating the market being perceived as the market leader.
President, CoStar Real Estate Manager
"The culmination of what we did as an organization in that timeframe was exciting," McDonald says. "Building a solution. Educating the market. And shortly thereafter being perceived as the market leader."
"We built an excellent product, we focused on customer relationships, we had a very good reputation in the market, and then it positioned us to capitalize on the ASC 842 compliance event," says Thomas.
Ned Walter, Regional Sales Director, has fond memories of this time. "Andy always put customers first. This was evident in the decision to join CoStar Group in 2011. This was evident in our early investment in our lease accounting solution and throughout the early days of lease accounting implementations. I learned so much from Andy over the last 18 years about people, sales, family, trust and leadership."
The underlying foundation and early mover status yielded CoStar Real Estate Manager its biggest jump in revenue in the organization's history.
Mentoring the next president
This transition was not something either McDonald or Thomas took lightly. In addition to the many years they worked together, they spent the months before Thomas's departure ensuring a smooth transition, asking questions and instilling wisdom.
"Of all the things Andy taught me, the biggest is the human aspect of leadership and management," McDonald says. "Now I will have to be a mentor. That is something I think about a lot.
CoStar Group acquired CoStar Real Estate Manager, formerly Virtual Premise, Inc., in 2011, and has since grown the business to become one of the most profitable within the company’s portfolio.
Under Thomas’ command, CoStar Real Estate Manager registered consistent double-digit revenue growth. He leaves the division in solid shape, with 1.5 million leases managed for some of the biggest companies in the world — including 240-plus of the Fortune 1000 and 10 of the top 15 U.S. banks.
Thomas is confident that success can continue under McDonald's leadership. "Besides Mark's characteristics," Thomas says, "having a strong leadership team in place will help him be successful, as it was important to my success."
A lasting legacy
When the people who worked with Andy all those years were asked what they'd miss about him, they didn't mention product developments or strategic decisions.
"I learned most from [Andy], though, through his care for us as a team and for his empathy and his kindness," shares VP of Product Dan Galenkamp. "He is someone who would drop everything to help someone in need – whether it was showing up with pumps at someone’s flooded house, following up on kids’ college applications or anywhere in between. He is just an incredibly kind man who exemplified what it means to care deeply for the people that you work with."
He is just an incredibly kind man who exemplified what it means to care deeply for the people that you work with.
VP, Product Management & Development
When Thomas reflects on his 20+ years with Virtual Premise and CoStar Real Estate Manager, he doesn't think of sales wins or stock prices. He thinks about the people he met along the way.
"I didn't set out to help people build careers," says Thomas, "But one of the things that turned out, in the end, was that great relationships got built between colleagues, customers, partners, and even competitors. There were just so many incredible relationships I got to enjoy over the course of time. It was an unexpected aspect. It's the thing I enjoyed most out of all of it."
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