Commercial Real Estate Evaluation Advances with Digital Tools: IntellCRE Highlights Path Forward
The commercial real estate (CRE) industry is making significant advancements in the analysis and valuation of properties, as market pressures compel professionals to reevaluate long-standing manual processes.
Market Context and Pain Points
While the commercial real estate industry has long used sophisticated tools for property assessment, current market conditions demand greater efficiency. The traditional process of gathering data, creating financial models, and generating reports can take weeks for a single property. This has prompted a new opportunity for innovation.
“Before 2021, when inventory was large and commissions were high, doing a handful of deals was sufficient,” notes Anton Zajac, founder of proptech startup IntellCRE. “But with rising interest rates and shrinking inventory, agents are working significantly harder while closing fewer deals.”
The CRE market lacks the readily accessible valuation tools that have become standard in residential real estate. As a result, brokers often spend weeks creating detailed marketing packages and conducting property analyses. Meanwhile, investors manually compile data from various sources to evaluate opportunities, and lenders require extensive documentation for underwriting processes. This combination of inefficiencies highlights the need for more streamlined valuation resources.
Technology Response and Market Forces
The industry’s response to these challenges has centered on automation and data integration. IntellCRE exemplifies a highly integrated approach, consolidating data from multiple sources into a single platform that delivers instant property valuations and in-depth market analyses. Their system not only extracts key metrics from financial documents and merges them with market data but also enables professionals to generate marketing packages and broker opinions of value within minutes, addressing critical efficiency gaps in the market.
Other players are exploring innovative solutions, ranging from blockchain-based property records to machine-learning-driven valuation models.
At the same time, growing market pressures have exposed the inefficiencies of traditional deal analysis timeframes. Zajac experienced this firsthand when selling one of his buildings. He identified a local price peak but lost several hundred thousand dollars in value during the seven weeks brokers spent preparing proposals.
The rise of platforms like Zillow has reshaped expectations around property data accessibility, while the emergence of AI tools like ChatGPT has accelerated the industry’s willingness to adopt new solutions. “People really realized, even in commercial real estate, that AI can help them work more efficiently and faster,” notes Zajac.
The Digital Future
Commercial real estate is moving toward fully digital deal flows. “Currently, deals aren’t entirely digital – parts might be online, but then you do the underwriting in your own room and sign a paper LOI,” explains Zajac. “What’s been missing is the ability to do the underwriting and processing of the deal online.”
This shift enables new investment models, particularly in fractional ownership. “You can own a fractional share of any public company,” Zajac notes, “but you cannot own a fractional share of any property that you choose. With deals going digital, this is going to be reality.”
Major brokerage firms are creating comprehensive digital environments where agents can access everything in one place – from market data and analysis tools to training resources and CRM systems. Zajac envisions a marketplace where buyers and sellers match more efficiently than through traditional channels. “We could see commissions lowering, which saves money for those that sell and buy. Commission might be lower for agents, but then there’s going to be more deals.”
Challenges and Outlook
The advancement of digital tools faces several interconnected challenges. Property data quality varies significantly across markets, making standardization difficult. Technical hurdles persist in connecting disparate data sources and systems, particularly given the complexity of real estate information. These challenges are further complicated by shifting economic conditions.
The evolution of CRE analysis tools could have broader implications for market efficiency. “If we can level the playing field in terms of who has access to what data, we can potentially see more agreement on property values,” suggests Zajac. “This could lead to increased transaction volume and market liquidity.”
As the commercial real estate industry evolves, the role of technology in property analysis and valuation will likely expand, with successful solutions being those that effectively address core industry needs while adapting to changing market conditions.
