Commercial Investment Real Estate July/August 2017 | Page 18

INVESTMENT
A N A LYSIS
Technology Rules
Automatic data capture will solve the problems with multifamily data.
or decades, the lack of uniformity in commercial real
estate data has been the bane of the industry’s existence.
To determine a value for a property before deciding to
purchase it, potential real estate investors must fi rst col-
lect and extract key fi nancial data from a multitude of disparate
fi les that come in countless formats and fi le types.
This is a burden for buyers, brokers, and lenders alike. The
analysis of the property — and comparing its fundamentals with
other investment opportunities — becomes unnecessarily dif-
fi cult and time-consuming.
In a world that’s seen Bloomberg terminals streamline the
analysis of corporate data and FICO scores used to rate credit-
worthiness, the lack of uniformity in commercial real estate data is
incongruous and ineffi cient, especially for multifamily properties.
F
Standardizing Data
In many circles, commercial real estate is still not considered an
institutional asset class, in large part due to this lack of cross-
industry data standardization.
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July | August 2017
While this problem has become more evident in the digital
world of 2017, the lack of standardization has been recognized
for many years. About 15 years ago, several major industry
players realized the problem and set out to develop solutions,
largely focusing on creating agreed-upon XML standards for
multifamily data.
Though the Mortgage Bankers Association, the National
Multi-Housing Council, and major commercial real estate
investors backed their efforts, neither the Mortgage Industry
Standards Maintenance Organization nor the Multifamily
Information and Transactions Standard has resolved this prob-
lem. Too many commercial real estate professionals still perform
data entry.
As time has progressed, technologies have emerged to develop
data standardization. Among the top contenders, automatic data
capture holds the greatest promise.
With previous standardization attempts, the chief problem
was the focus on creating a specifi c format for all parties. Partici-
pants would adhere to this standard format when compiling and
COMMERCIAL INVESTMENT REAL ESTATE
by Elliot Vermes