Global Real Estate Firm Embraces the Cloud
A global real estate firm saved 92 percent of time spent on valuations by moving the process out of spreadsheets and into a custom cloud-based web application.
A leading global commercial real estate services firm wanted to simplify and modernize their purchase price allocation modeling process. Their current process was too reliant upon outdated technologies, was error-prone, and took too much of their appraisers’ valuable bandwidth.
Saxony Partners was enlisted to develop a new, modern web application to move the process out of Excel Hell and into the cloud. Ultimately, valuations that took as many as two weeks would be completed in just a couple of hours.
Saxony began by examining the current workflow for valuations, and the team quickly discovered the primary cause of the 14-day bottleneck – virtually everything was being done in Microsoft Excel.
There were as many as 40 spreadsheet files involved in the process, which required cutting and pasting data from two source systems, as well as various types of unstructured data. Because of the sheer size of these files, the amount of data inputted, as well as the number of people inputting data, error correction was extremely time-consuming and cumbersome. Further, without a consolidated database it was impossible to report aggregated results across multiple valuations.
Saxony’s technologists concluded that moving the process out of desktop spreadsheet software and into a modern, web-based platform could save an enormous amount of time. It would also improve data integrity and security by establishing some much-needed standardization. This new platform would integrate directly with the two source systems, handling both structured and unstructured data. Reports could be created and exported with ease back into a Microsoft Office environment utilizing pre-defined templates.
This solution would do more than solve short-term challenges, it also set the firm up for the future by providing a foundation to scale and evolve the platform to adapt to future technology advancements.
As the platform was beginning to take shape and testing began, the value of modernization and standardization revealed itself immediately. In the old spreadsheet system, valuations were being rounded off after only a couple of decimal places. In the new, web-based platform, valuations were much more precise – to the ten-millions place.
The new platform was such a hit that the client decided it would be the foundation for future appraisal applications going forward and cancelled an internal app dev project already in progress.
Here’s the big takeaway: This firm ended up with more accurate valuations in less time by utilizing modern technology. The platform upgrade improved user experience and boosted the rate of adoption. Calculations that used to involve dozens of spreadsheets were made repeatable and more reliable. Time that used to be spent making formula changes and tracking down errors was saved. Aggregated reporting and analysis was much easier.
Here are some bottom-line impacts:
- The firm saved 92 percent of time spent on valuations – going from 14 days to complete one cycle to mere hours.
- The client was able to hire more junior-level appraisers, opening up opportunities to grow young talent and saving approximately $30,000 per new hire in annual salary.
- There was significantly less overhead cost per valuation, which led to greater profit margins; this set the firm up for about $5 million in savings each year.
- Because valuations took less time than ever, the firm was able to increase the number of valuations each year by about 5 percent.
- Client retention improved, influenced by the new and more reliable valuations process.