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How Proptech is bringing CRE Investing into the future

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The transportation business is being disrupting by Uber. Coworking is helping to change real estate from a fixed asset into a service. Airbnb has turned the vacation rental and hotel industries upside down.

Cutting-edge technologies applied to property are creating Proptech, and it’s revolutionizing the world of commercial real estate as we know it.

In this article, we’ll take a look at how Proptech is changing commercial real estate financing, and how to make sense of it all so you can start making smarter decisions based on facts and data.

Property + Technology = Proptech

A report from earlier this year by JLL cited four main ways that commercial real estate processes are being changed by applying technology to property investment and ownership:

  • Artificial intelligence – AI
  • Computer-aided design – CAD
  • Virtual reality and augmented reality – VR & AR
  • Big data and analytics

Proptech can be found in all aspects of the commercial real estate industry.

AI is being used in research and analytics. CAD, VR, and AR are helping propel 3D modeling, construction verification inspections, and virtual tours to entirely new levels. Big data is being collected and analyzed in thousands of different ways to remove the guesswork from commercial lending and asset management.

Proptech investment hits a record-setting $12.9 billion in H1 2019

Through the first half of 2019, venture capital investment in real estate tech startups hit a record high of $12.9 billion. That’s greater than the entire previous record year of 2017, according to research firm CREtech. But why is so much smart money being invested in property technology?

The answer is that Proptech investment isn’t the only thing that’s breaking records. Commercial property values are also reaching record highs. While CRE asset prices keep rising, disruption is simultaneously taking place.

The office, retail, and distribution sectors are being reimagined by firms like WeWork in coworking, Amazon in retail services, and Walmart in the online grocery business. In turn, CRE stakeholders are turning to Proptech to drive revenue increases, cut operating expenses, place capital more efficiently, and to avoid becoming dinosaurs.

Using Proptech to grow, prosper and evolve

It’s no secret that the real estate industry has been slow to embrace innovation. KPMG surveyed 270 real estate decision-makers around the world. The firm’s Global PropTech Survey reports:

  • 97% think digital technology innovation will impact their business
  • 73% see digital technology as an opportunity
  • 56% rank their business 5 or below out of 10 in terms of digital technology innovation maturity
  • 30% say they currently or plan to invest in Proptech, while the remaining 70% do not

While it’s clear that almost all real estate practitioners understand the importance of Proptech, very few are actually harnessing the power of applying technology to real property. Those that actively rethink their business with technology will continue to thrive, those that don’t will likely become extinct.

As Charles Darwin once said, “It is not the strongest of the species that survives, nor the most intelligent. It is the one most adaptable to change.”

How Proptech is changing CRE finance

At the beginning of this article, we listed four main ways that Proptech is changing the business of commercial real estate: Artificial intelligence, computer-aided design, virtual reality/augmented reality, and big data analytics.

In almost all industries, big data and the way that it’s used is king.

Big data analytics is how Amazon knows what you want to buy almost before you do, how Google or Alexa know what you’re looking for before you’re done typing or speaking, and how Netflix recommends which movies to watch and when.

The commercial real estate industry is no different.

Proptech is used to gather, structure, and understand data to improve the way investors finance property. With access to unbiased information based on transparency and lending activity rather than marketing hype, investors can make smarter decisions when placing capital.

Why Proptech is transforming CRE financing

No area of the real estate industry is riper for transformation than CRE finance. There are two reasons for this:

#1 CRE investment is capital Intensive

Unlike most other industries, commercial real estate is fueled by massive amounts of capital that is still arranged primarily through human advisors with their own agenda.

#2 Real estate is unique

In addition to being scarce, no two pieces of real estate are exactly the same, emphasizing the need to make smarter decisions based on facts and data rather than human emotion.

Three examples of Proptech and CRE finance

Here are three of the many ways that Proptech is being used to simplify and streamline capital investment in commercial real estate transactions:

Built

Built is a platform designed to manage risk and maximize productivity in construction finance. Lenders using Built can import all construction project data onto the platform, oversee draw requests, and ensure that regulatory exams and audits are complied with. The movement of money into projects is accelerated by eliminating manual processes and siloed systems.

Qualia

Qualia is a cloud-based platform for real estate closings. The firm works with all stakeholders in the real estate closing process – lenders, underwriters, brokerages, vendors, institutional investors, and buyers & sellers – to deliver title, escrow, and closing services on an SOC 2 certified platform.

CrediFi

These first two examples show how Proptech is being used once an investment has been made. But before a construction loan can begin or a closing can occur, the most active lenders in the market need to be identified and capital needs to be sourced.

CrediFi simplifies and streamlines capital investment by using big data to analyze lending activity by lender type, geographic market, and asset class.

Which Proptech technology should you adopt first?

While Proptech can help real estate investors and developers streamline projects and optimize profitability, the fact is that nothing happens in commercial real estate until the money flows. That’s why it’s critical to have access to detailed and unbiased commercial real estate financial information.

Any commercial real estate practitioner seeking capital for their property’s refinance or next target acquisition can benefit from the CrediFi Analytics. By using big data from $13 trillion in loan originations on 8.7 million properties and 6 million loans, CrediFi clients can easily locate exact lender contact information and detailed loan origination activity.

Learn more about how CrediFi can help accelerate your capital raising

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Mary Kovac Goldberg (Parrino)

Head of Customer Success

Mary has over 25 years of experience in sales and customer engagement, including more than a decade at Thomson Reuters. She is the former head of client services at Complinet, a global compliance and risk software company that was acquired by Thomson Reuters, and led account management for over 15 years at NYSE/Sector’s outsourcing services division. Mary has an MBA in information systems from Pace University and a bachelor’s of science in computer science from Hofstra University.  

David Libman

Head of Product

David Libman, a fintech and investment professional with 20 years’ experience in fields including finance, technology, new business development and real estate investments, is head of product at CrediFi. Previously, David was a vice president at New York-based iCapital Network, a financial technology platform for alternative investments, and director of acquisitions at Fieldstone Properties, a private real estate investment firm focused on investment-grade multifamily property. David is also the founder and former CEO of Globerex, the first real estate equity online marketplace.  

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SUBMIT YOUR REQUEST FOR COMMERCIAL REAL ESTATE FINANCING


Request a demo today.

Find out how you can discover more opportunities with access to the most comprehensive CRE financing database.







Book your personalized
CRE data consult today.

Gain access to CRE finance data on 6M properties & 4M loans.





Book your personalized
CRE data consult today.

Gain access to CRE finance data.


















Request a CrediFi demo today.

Find out how you can discover more opportunities with access to the most comprehensive CRE financing database.



















Request a CrediFi demo today.

Find out how you can increase your deal flow with access to the most comprehensive CRE financing database.



















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Request a CrediFi demo today.

Find out how you can discover more lending opportunities with access to the most comprehensive CRE financing database.



















Book your personalized
CRE data consult today.

Gain access to CRE finance data.


















Request a CrediFi demo today.

Find out how you can discover more opportunities with access to the most comprehensive CRE financing database.







Request a CrediFi demo today.

Find out how you can discover more opportunities with access to the most comprehensive CRE financing database.



















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Alex Veksler

Head of Content

Alex Veksler has 16 years of finance, data analysis and project management experience. He is a former vice president at Morgan Stanley, where he worked on product control of equity and fixed-income derivatives products as well as various projects involving finance and technology, such as revamping risk attribution and balance-sheet systems for profits and losses. Alex has previously worked at hedge funds, most recently as a director at Exigent Capital. He has a bachelor’s in computer science from Yeshiva University and an MBA from New York University.

Ely Razin

CEO

Ely Razin founded CrediFi in 2014 with Battery Ventures. A rare combination of seasoned corporate executive and technology entrepreneur, Ely previously served as global head of board governance for Thomson Reuters Accelus and head of business law for Thomson Reuters, after the software company he founded was acquired in 2004. The company, Expert Ease Software, developed AI-based software that automatically summarizes key deal terms for transactions in fields including capital markets, M&A and real estate. Ely began his career as a corporate and securities lawyer, and holds an LLB and MBA from York University.

Amichai Levy

VP R&D

Amichai Levy is the former VP of R&D at Israeli high-tech firm Payoneer, where he developed its signature cross-border payment platform and integrated it with existing bank technology. In his prior role at Ness Technologies, Amichai was a key player in developing an electronic case filing system for Israel’s courts. He has over 20 years of experience in software engineering.

David Fajgman

Head of Finance

David Fajgman brings over 14 years of financial and managerial experience to CrediFi. Prior to joining the CrediFi team, he served as finance director of Bioness Neuromodulation Ltd., which develops and manufactures medical devices involved in neurological rehabilitation. He has previously worked in multiple finance roles at Thomson Reuters and as an accounting and consulting manager at Ernst & Young, where he was responsible for a wide range of clients, including companies listed on the Nasdaq and privately held high-tech companies. David is an Israel-licensed certified public accountant and has a bachelor’s degree in business and accounting.

Liat Bar David

Head of Human Resources

Liat Bar David has over nine years of human resources experience, primarily focused on the high-tech industry. She is a former HR business partner at semiconductor solutions provider Broadcom, where she was responsible for onboarding processes, benefits, policies, training and development, performance management and employee retention. Liat holds a bachelor’s in communication and human services and a master’s in human resources and services, both from the University of Haifa.