Commercial real estate (CRE) management continues to evolve following the growth of new technologies designed to help firms better understand the operational performance of their properties. As we look into 2016, what are the emerging strategies related to data and CRE management? We highlight three pertinent trends for the year ahead.
Data Analysis at the Portfolio Level
Although understanding the operational performance of individual buildings remains imperative, CRE owners, executives and managers are beginning to realize the importance of advanced portfolio-level data analysis. This trend is an evolution of how data is traditionally being used in CRE management: data collection and analysis has remained largely focused on individual building performance with portfolio-level data focused on top-line results only.
Centralization of items such as budgets, energy use and capital expenditures at the portfolio level is helping firms become more efficient and financially aware of how capital planning is optimized over time—with software and data analytics key to this process. Future operational strategies, accordingly, are becoming more aligned between asset-level performance and corporate-level goal and objectives.
Active Risk Management
Risk management in real estate remains a somewhat ambiguous catchphrase, balancing the line between economic, financial, social and regulatory considerations. Regardless of how risk management is defined for an organization, it is becoming an increasingly important topic for CRE management given the complexity of real estate and the factors—both internal and external—that drive its performance.
However, many firms continue to assume that risk measurement is the same as risk management and focus their data analysis efforts accordingly. Progressive real estate organizations are starting to look at their risk data differently, moving away from static reports on risk factors such as tenant/income risk, financing risk and environmental risk to actively identifying and processing weaknesses or threats through more comprehensive and strategic data analysis.
Advanced Automated Reporting
The automation of performance reporting, whether for clients or internal stakeholders, is a rapidly evolving trend in CRE management. Investment returns, capital expenditures and occupancy levels, for example, are all performance metrics that can be automated with today’s software platforms to the point where manual input is minimal. Drawing parallels from the financial industry, reporting requirements for real estate are becoming increasingly complex following greater scrutiny of operating performance from investors/stakeholders. Automated reporting systems, accordingly, are reducing the need for large (and time-consuming) analysis efforts leading up to key reporting dates. As long as the underlying data is current, standardized and optimized for analysis, reporting can almost be done “on-demand” and customized for multiple uses.
Innovative Data Solutions with 4tell™
As firms continue to adopt more advanced CRE management strategies, data remains central to advanced analysis efforts. See how 4tell™’s Real Estate Portfolio Solutions “asset-centric” data approach is helping real estate organizations manage their portfolios and assets for the future.
Photo: Benjamin Combs
RSS Feed