Everything You Need to Know About
Commercial Real Estate Development Tools

Having data on how similar project decisions panned out can inform what you do on your current project. And when you can reference that past data quickly, it becomes easy to make informed choices instead of trusting your gut. 

How Real Estate Development Software Aids Better Project Management and Outcomes

Modern real estate development software uses automation and data analytics to aid your project outcomes, but what about artificial intelligence? AI is used to track cash flow trends and flag budget lines that are trending high. This allows project managers to make real-time adjustments instead of backtracking to see where budget forecasts were off after the fact. 

For example, if the system flags that labor costs are trending high, you can swap certain materials, like granite countertops, for similar-looking but cheaper materials to account for the budget line overrun. You've now prevented what would have been lost money without changing the project's overall scope. Multiply this by the numerous budget lines across multiple projects, and the savings add up to a small fortune. It’s a great look for the project team responsible for making these budget-saving decisions.

With real estate development software, your project team is shifting their mindset to proactive, data-driven decision-making. With the backing of real estate development software your team is empowered to: 

The big problem with that kind of manual workflow is that it forces decision-makers to make gut-driven, reactive choices that could have negative consequences down the line.

However, real estate development software enables teams to work on their project proactively via real-time expenditure tracking. A modern platform can capture change order information as soon as its received and integrate it into a centralized project database. Afterward, the platform will automatically generate forecasts showing how the higher costs will impact the budget several months into the future. And if the new data input creates a trend that will ultimately push the budget into the red, the AI-powered system will send you a predictive alert.

With access to real-time project data,  the platform will give you actionable insights on problems like building material price hikes as soon as they happen. Leveraging the granular insights provided by real estate development software can help you significantly reduce overruns.

4 Ways in Which Your Team Benefits from Vendor Data Transparency

Commercial real estate projects are often complex, costing millions and requiring the services of hundreds of vendors. Your project development process may need everything from a site surveyor to a lighting designer. With so many moving parts, it’s no surprise that a project’s overall success depends on vendor performance. Each service provider must complete their respective tasks under the agreed-upon contract terms.

Something as crucial as vendor performance shouldn’t be left up to chance. Here’s a look at how real estate development software can mitigate that risk and ensure better project outcomes.

#1 Using Past Performance to Select the Best Vendors

Data stored from past project projects should inform your decision-making process. With past vendor performance data at hand, your team can quickly determine which potential partners have a track record of being reliable and responsible.

Suppose a vendor has historically had the lowest bids but submits a higher-than-average number of change orders. In that case, you’ll know that their services are more expensive than they seem. Choosing a vendor that may have a high initial proposal but completes their work within your initial budget is the best option.

Making the best vendor procurement decisions will enable you to create a solid budget at the start of development and ensure the project development process is as smooth as possible. 

#2 Paying Invoices on Time

For your vendors to stay on schedule, they need to be paid on time. With hundreds of vendors on different payment schedules, it’s easy to lose track of which invoices are due at what time. If your team’s payments are late and vendors deprioritize your job, you could easily lose up to three days of progress each month. Ultimately, those delays can add up to months of lost time over the course of a multi-year project.

Real estate development software keeps your invoices organized. With that functionality, you can manage all vendor communications within the platform, so you’ll always know their progress and needs.  

#3 Clearly Communicating Any Changes

Vendors can only complete their job if they have all the necessary information from your team. That means clearly communicating any design, materials, or expectations changes should be a priority. 

Utilizing a purpose-built, cloud-based platform for early project planning gives all team members and vendors access to the same information. The benefit of having a single source of truth is that no one works off outdated spreadsheets stored on hard drives. 

Instead, everything is updated in real-time in the cloud. That way, no vendors unintentionally complete work that is no longer necessary, or working from old directions will result in losing time and money.

#4 Anticipating and Accounting for Any Obstacles

To keep your development project running smoothly, you want to be proactive, not reactive. Real estate development software makes it possible to look ahead and identify important project trends and challenges. With that information at your fingertips, you’ll have insight into problems that could arise and impact your vendor’s jobs, like increased hard and soft costs.

Instead of suffering through delays to your schedule and cost overruns, you can readjust your strategy and keep ahead of any negative fallout.

Now that we've identified Excel's biggest benefits and shortcomings let's look at how it stacks up to a purpose-built management solution.

Like a spreadsheet, real estate development software can store all the salient information and documents related to a project. But since web-based platforms are dynamic, they can provide much greater visibility, functionality, and accessibility. The user can go from a comprehensive 30,000-foot executive view to a granular perspective in just a few clicks. If you have a question, you can find the answer on your office computer, home laptop, or the smartphone you use to watch Netflix on the way to work.

Next-generation project development solutions also bulldoze data silos and eliminate data entry. Modern platforms use artificial intelligence systems to gather, extract, and index the salient project information from your existing email workflow. That means no more phone tag, time-depleting data entry, or error-ridden spreadsheets. All that time and energy can be directed toward project acceleration and pursuing new opportunities.

Purpose-built programs offer more benefits, including greater efficiency and productivity. These solutions can examine your historical and current project information to generate precise forecasts and identify future challenges so you can mitigate them before they become costly disruptions. And it can identify opportunities for you to use your budget more effectively.

The biggest difference between spreadsheets and real estate development software is reactive and proactive workflows. Because of their advanced functionality, data-driven solutions can help you have easier, more predictable outcomes on your projects. And integrating a state-of-the-art real estate development platform into your existing workflow is a lot easier than you might think.