By: KeyCrew Media
Ask an asset manager where a property’s operating data lives, and the answer is usually short: the property management system. That answer leaves out most of the picture, and it helps explain why so many asset managers can see expenses rising but cannot trace the cause.
Bill Douglas, CEO of OpticWise, asks owners that question often. “The first and usually the only thing they say is, yeah, it’s in our property management system,” he says. Then he walks through the other systems running on the property. “They say, I don’t know.”
One Data Source Out of 12 to 15
Douglas says a typical commercial property runs 12 to 15 separate systems. Alongside property management, there are building management systems, parking systems, lighting controls, and others. Each holds a piece of the data that drives operating costs, and each keeps that data to itself.
That “I don’t know” has been the standard answer for five years, Douglas says. What has changed is that owners are starting to realize it matters.
Outsourced property management adds distance. Many asset managers do not employ the property manager directly. They receive a report once a month, and it covers only what was requested. “If the asset manager wants to know what the efficiency is on this or the expenses on that or the contract is on that, that’s what they get back,” Douglas says.
Below the reports, there is often another layer of spreadsheets. One asset manager Douglas spoke with described working from a stack of shared files, many of them Google Sheets, that were emailed back and forth and not always current, while capital allocation decisions were being made from them. “The data’s sitting right there,” Douglas says. “They’re just not collecting it.”
Reports Show Results, Not Causes
A monthly report summarizes what already happened. “I like to say the key performance indicators for financials are looking backward. What did we do last month?” Douglas says. “For us to change it, it’s going to take two or three months.”
The asset manager sees the result but not the underlying data that produced it. Douglas puts the frustration in the asset manager’s words: “Why does it take me a day or two every month to process a report, and the report is just one layer up?” From that report, he says, the only option is to make a change, hope it works, and look again next month.
An Algebra Problem With Missing Numbers
Douglas compares the situation to basic algebra. If a formula contains X, Y, and Z and you only know Y, you cannot solve it. If you know two of the three, you can solve for the third. “This is just algebra,” he says. “But if you don’t have the inputs, you can’t solve it.”
NOI is the output. The inputs sit across a dozen or more systems, and the asset manager may see only one of them. “They know they have a problem with the output, but they don’t have enough inputs,” Douglas says. Even if a property had only five systems, he adds, that is still far more than the property management system alone.
From Inputs to Action This Month
With access to the underlying data, the timeline changes. “I can affect next month’s NOI based upon what I do the last two or three weeks of this month,” Douglas says. “That’s a forward-looking capability that most asset managers don’t have because they don’t have the data.”
Collecting data is not the goal on its own. “Data is useless unless it ends up in a task that somebody can do that improves the performance of the company,” he says. “Just collecting the data doesn’t do anything.”
That is the logic behind OpticWise’s approach. It starts with property intelligence, meaning specific plays an asset manager can act on, and builds toward a Property Brain™, where building-level data from the property’s systems is held in one place the owner controls. Douglas’s advice is to start with a few areas, make improvements, and then decide which additional data would be most valuable.
For asset managers trying to improve NOI, a useful first question comes before any software decision: which of the variables behind this property’s results can I actually see today?
Bill Douglas is CEO of OpticWise and co-author of Peak Property Performance®. For over three decades, he has used technology to solve complex business problems, and he also coaches executives and entrepreneurs, men over 45, on body, business, and being as ResilienceGuy.
Disclaimer: This article is based on information provided by the expert source cited above. It is intended for general informational purposes only and does not constitute legal, financial, or real estate advice. Readers should conduct their own research and consult qualified professionals before making any real estate or financial decisions.
