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Leaders in many sectors are (rightfully) trying to stabilize and reinforce their businesses in light of the global pandemic and recent economic downturn. Real estate owners and developers are no exception.
Even before the pandemic and its subsequent effects hit, the commercial real estate industry was faced with increased trade war tensions, volatile pricing in global gateway markets like NYC, San Francisco, and London, the removal of SALT deductions, and uncertainty surrounding the rise of coworking as a traditional office alternative. It was easy to feel the pressure and want to take action then, and now the sentiment has only multiplied.
But how do you prepare and protect your real estate business from such uncontrollable forces? And how do you navigate and stabilize operations if caught in the middle of a downturn? As a real estate owner or developer, it is now time to start asking yourself these questions and start taking action.
When the markets are in your favor, it is easy to make a decent and consistent return just by riding the wave, however, now that market dynamics have shifted, you can’t just stick with what you’ve been doing and hope for the best.
You need to turn on a dime to ensure you’re operating with leaner, more cost-effective strategies and while you look for ways to reduce overhead and maintain your bottom line, you’re already two steps behind. The solution? Automation and data analytics.
We’ve spoken with a number of developers over the past few months, and have found that those who have adopted advanced technology have been able to maintain control over their projects from remote work settings and have continued to keep a tight handle on their budget. They have also been able to reassure financial partners that they have complete visibility throughout their project and are being proactive in protecting their projects from relevant uncontrollable external factors.
For many, COVID-19 was an unwelcomed wake-up call that only amplified typical worries related to a potential economic downturn (think: shrinking profit margins, budget overruns, vendors with tighter cash flows and less ability to wait for your team’s slow processing, etc.).It likely made you assess current operations and expedited the implementation of processes that ensure long-term success. Many have tried hiring additional administrative staff or junior project managers or started working longer hours to try to regain control of their projects, but have not seen the payoffs they were hoping for. The problem with these solutions is that they still require teams to live in complex spreadsheets that bog them down by creating information silos and hiding calculation errors. The solution is simple -- automation.
For instance, incorporating modern, tech-forward practices into your operations today could be an investment that yields continuous value creation for your firm, investors, and clients down the road. Making sure your project and development teams are using the latest, most sophisticated technology and software could immediately save you time and money and be the insurance policy you’ve been looking for. By having the right tools in place, you’ll be able to get easier, more predictable project outcomes, decrease costs, and maintain your level of work – if not increase it – without compromising on quality or spreading your staff too thin.
Implementing a software like Northspyre is guaranteed to help project teams run more efficiently. It was created to empower developers to make more data-driven decisions by providing forward-looking metrics that allow them to stay proactive and strategic. After analyzing more than 100 real estate project teams across the United States, we discovered that most teams are squandering roughly 30% of their project staffing hours per year on low-value, administrative tasks. This includes: getting bogged down in spreadsheets and miscellaneous documents, trying to reconcile discrepancies, uploading and organizing files, the simple act of keeping a project moving forward and much, much more.
With such chaotic processes, it’s no wonder teams are leaving money on the table due to delays, bottleneck decision-making, overpaying vendors, ballooning loan interest payments and the inability to build accurate forecasts. And that’s a hard reality even outside a global pandemic.
But there’s a path forward. By leveraging automation, data analytics and proactive intelligence, Northspyre provides teams the foundation they need to make smarter and faster decisions – all without the administrative hassle and traditional disorganization that can slow down a project and inflate a budget. Northspyre was developed by real estate professionals for real estate professionals and specifically works to:
- Empower project teams to be more data driven, allowing them to achieve easier, more predictable outcomes
- Leverage proactive intelligence and insights to help teams keep a strong handle on current and future project finances, even with economic headwinds
- Position lean project teams to deliver projects on-time and on-budget, effectively saving up to 2-3% on overall project costs
- Eliminate 30% of low-value staffing work so teams can more closely monitor projects to stabilize returns
- Enable teams to finish projects ahead of schedule and beat oversupply from competitors who may deliver a few months too late
- Provide a competitive edge and reinforce industry expertise, impressing financial partners, management teams, clients and other key stakeholders
The benefits of implementing a developer-centric, intelligent technology today are immediate. As a bonus, if your team is already operating in a highly cost-effective and efficient manner during a recession, your business will be even better positioned to withstand any future unfavorable swings in the economy.
Making an investment into sophisticated technology is just what you need to impress investors and prove that you are financially equipped to handle anything.
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