Magazine article Journal of Property Management

True Value

Magazine article Journal of Property Management

True Value

Article excerpt

Technology investments build a foundation for managers to streamline operations and efficiency

The use and deployment of capital are critical decisions within real estate companies. Until recently, many firms were slow to invest in back-office technologies such as property and lease accounting software, accounts payable systems and financial and joint venture reporting because they had difficulty understanding how value would be realized. Now, with a broader perspective, organizations can establish strategies to deploy technology to obtain value.

In 1999 and 2000, approximately 300 dot-com solutions were targeted at the real estate industry with more than $2 billion funded by investment banks and private equity firms. Some tremendous solutions were offered to facilitate electronic collaboration with customers, tenants, suppliers and business partners. However, in order for a company to collaborate with external parties, its internal processes and systems must be in alignment and in many instances this was not the case. For example, if a company was slow in applying cash receipts to open tenant charges, the organization would create more work for itself by allowing customers to access their accounts online, as the information was not up-to-date.

Additionally, while e-procurement solutions allowed organizations to purchase maintenance, repair and operation goods online, limited understanding meant they couldn't tell whether they were saving money.

From a systems standpoint, the best way to gain transparency within an organization is to implement a portfolio-wide, enterprise-level property and lease accounting system to ensure all information is accessible from a single location. Using accounts payable allows an organization to identify where and to whom its money is going-e.g., how often vendor discounts are taken, what cleaning services cost in one market versus another and if the organization has multiple, non-leveraged contracts with the same vendor. …

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