Forecasting Job Costs and Onboarding Properties in Yardi for a Global Real Estate Firm
A century-old real estate services firm with more than 100,000 employees managing projects in more than 100 countries called on Saxony Partners to solve a problem related to job costs. The firm needed to standardize the way they tracked and forecasted job costs across properties in Europe, Asia, and beyond.
Saxony Partners leveraged the company’s existing Yardi environment to create a standardized platform for tracking these expenses and, in so doing, was invited to expand our scope into Yardi property onboarding.
Job costs – familiar to anyone in real estate development – is a catchall term for all costs associated with the development and construction of building projects. In Yardi, these costs can be tracked within a module called Construction Management.
This firm had expanded development operations in countries across Europe, the Middle East, and Asia. In the process, they discovered that different countries had varying and unique ways of managing job costs. Restrictions and governance in Germany were not the same as those in the Netherlands, and neither of those were the same as Sweden, and so forth.
These differences made standardization of job cost tracking very difficult. And without a standardized process, it was difficult to report on what costs were due at what time. This created friction between the firm and its funders, as the latter expects capital allocation to follow a well-planned schedule. Unexpected job costs meant that the real estate firm had to go to the funders with ad hoc or unexpected capital draw-down requests, and that was a very inefficient and, frankly, stressful process. This was happening across multiple projects across multiple countries.
What the firm needed was a standardized, structured, and repeatable process to manage these costs. Yardi’s Construction Management module was the platform they wanted to leverage in this effort, but there was no way they could slow down their own work sufficiently enough to set-up and optimize the module themselves. Further, they didn’t want to devote costly internal resources to the effort. They knew this because they had already attempted the fix internally before deciding that they didn’t have the capacity necessary to finish it.
Saxony Partners’ Real Estate consulting and Yardi service team had already completed some domestic work for this client. We met with the firm’s global team and briefed them on our deep experience within the international real estate sector. Confusing European regulations, value-added tax, time zone management – our team has effectively managed these roadblocks before.
The initial project focused on three regions – Germany, the Nordic countries, and the Netherlands – as they were the most sophisticated and had the most development opportunities and processes to work through. Saxony met with leaders from each region and assessed current and future needs. From there, we moved to assessing the chart of accounts and cost structures.
Then, we determined the firm’s reporting needs, first determining what was available out of the box with Yardi, and then devising a plan for meeting needs beyond that. Doing so required that certain types of data be captured – and captured in a certain way. We worked with the firm to define and execute on that data capture plan, structuring it all within the Construction Management module.
This front-end work took approximately two months to finalize. Doing so not only solved job cost issues related to these initial three regions, but provided a template moving forward to address issues in all other regions where the firm did business.
The three-region job costs project went live shortly thereafter and was highly successful.
The job cost project deepened existing relationships between Saxony and this firm – and created new ones, as well. The more the firm learned about our expertise, the more they enlisted our help with other projects related to property onboarding and Yardi-related issues.
As a result of our partnership, the firm now has:
- A standardized platform for managing job costs
- A consistent chart of categories
- Consistent, repeatable processes and workflows across all regions where they do business
- Regional reporting
Now, all parties are on the same page about budget and funding – with everything being tracked in Yardi. Nuanced reporting needs are being met and both aggregate and consolidated reporting can be delivered up-and-out. The firm now has a template and framework that is actionable worldwide.