The commercial real estate industry is just now realizing the explosive growth in Internet applications that has already occurred in other industries. For example, in 1996, there were about 50 Websites where you could apply online for a residential home mortgage. Today there are an estimated 3,000 sites. In commercial real estate, only a handful of Internet sites offer online applications for commercial mortgages, although dozens of additional sites can be expected in the coming months.

Jack Welch, CEO of General Electric, says that electronic commerce is clearly the biggest revolution in business in our lifetime. "It will change relationships with employees, with customers and with suppliers," said Welch. As our own industry ramps up, important insights can be gained by looking at how e-commerce has affected others.

Insight No. 1: "The important thing isn't so much what technology you own as how well you can work with all the players," says John Chambers, CEO of Cisco Systems, quoted in a recent issue of Fortune. Chambers says that we're in the midst of a sea change in which the Internet has transformed the information technologies industries from a collection of oligopolies into a more diverse ecosystem.

Some of the biggest firms that design, engineer and build large construction projects are turning to the Web for solutions. Building these projects is collaborative, involving many participants from different disciplines. Using the services of sites such as buzzsaw.com or bluelineonline.com, sponsoring companies establish a Website for the project which is password-protected. Access is controlled and multiple levels are available. Engineers and contractors see relevant project and scheduling data; financial and administrative managers have more complete access. Principal benefits include improved communications and time savings. The technology is not owned but "rented" on an as-needed basis.

Insight No. 2: The Internet has changed the balance of power between buyers and sellers. Auction sites such as eBay.com have become very popular, and mainstream corporations have begun to take note. Ford Motor Co. recently announced that it will allow visitors to its Website to negotiate prices for new cars using Priceline.com's online bidding system. In our industry, at least one site exists today that offers a form of auction service for trophy commercial real estate properties. Imagine the impact if bidding for commercial properties were to become widespread.

Insight No. 3: The Internet has begun to dramatically change distribution channels. This was exemplified recently in one of the most competitive of U.S. industries. In late November, four of the largest U.S. airlines announced that they would establish a "neutral" Website that would allow consumers to purchase low-cost airline tickets. This neutral site is in addition to a participating airline's proprietary Website.

In our industry, some commercial real estate brokers and lenders are forming working relationships with other "neutral" Internet sites such as Loopnet.com. These sites list commercial properties for sale or lease and allow prospective buyers to apply online to multiple lenders for commercial real estate financing. For some brokers, this is in addition to their own Internet listings; for others it becomes their listing service. For KeyBank, whose Website allows borrowers to apply online, this entails new working relationships to serve a larger group of borrowers. It also presents an opportunity to alter roles in the process - to specialize in one or two elements, rather than provide all facets of the service.

Insight No. 4: In the face of periods of revolutionary change, companies need to evolve substantively, not incrementally. Here is some context: The telephone is more than 100 years old; the Internet less than 10. Last year, the Internet surpassed the telephone as a communications channel when 3 billion messages were sent each day.

Microsoft and Ford have joined forces to create a build-to-order system that someday would allow an online shopper to order a car from the factory. The city of Pittsburgh plans to sell $55 million of bonds directly to institutional investors over the Internet, bypassing Wall Street dealers.

In our industry, AMB Property Corp., a San Francisco-based REIT, has reportedly sold 28 shopping centers and contracted to sell six more. Its CEO plans to reallocate capital into what he believes is a fast-growing sector - high through-put distribution facilities. Underlining his point, Trammell Crow Co. reported that Amazon.com recently took 600,000 sq. ft. in Reno/Sparks, Nev., and 800,000 sq. ft. in the Atlanta area.

Insight No. 5: "You can know everything from the Internet, but it cannot replace personal experiences with people." The speaker was Jiang Zemin, China's president, who was commenting to a group of Time magazine editors who marveled at being able to use the Internet cafes in Kashgar, China.

The present is virtually "ground zero" for e-commerce in our industry - a time of tremendous potential. The opportunity is open to all to take advantage of it.