Neil Pierson is editor of Scotsman Guide Commercial Edition.
Reach him at (800) 297-6061 or email@example.com.
By Neil Pierson
Tech-savvy mortgage brokers can create an edge
No matter how large your business is, technology is becoming an increasingly necessary and valuable tool for
a commercial mortgage broker. From geographic information system (GIS) mapping to customer relationship
management (CRM) software and even drones, brokers have tools at their fingertips that can make their tasks
To achieve that efficiency, however, brokers must be competent with the technology they’re using and understand its purposes. Ely Razin, CEO of CrediFi, a big data provider for commercial real estate, spoke with Scotsman
Guide about current technological trends within the industry.
How is big data different today compared to a few years ago?
What the old guard [of data collection] basically does is, it relies on data that is aggregated through old processes.
Let’s call those phone calls. It’s highly reliant on human-to-human connection, which is good, assuming the
human on the other end of the call is the right person. … The problem with it is, it’s completely not scalable.
So, if I want to cover not 100 transactions, but I want to cover 3 million buildings and look at them every single
day, I can’t do that by phone.
If you have a small pool of data, you cannot arrive at big conclusions. You can’t arrive at market-wide analytics
if you’re just looking at a small number of things per day. And therefore, if you’re looking to power people with
intelligence about what’s going on overall in the U.S. market, or more narrowly in the Phoenix market, or even
more narrowly in Scottsdale (Arizona), you’re not going to get that by calling a few people in Scottsdale and
getting a couple of data points. You need more information. You need information about the buildings. You
need information about the owners, about the lenders.
Does mapping technology make commercial mortgage brokers more efficient and effective?
Sometimes it’s nice to know what the buildings are, their addresses, and which buildings are offices versus
multifamily. That’s a start. You need data to tell you that. Then I want to know, who has financed those buildings?
I can map that, too, but I need data about the financings in order to know how to push that on a map.
… I can show how those types of buildings and the financing patterns overlap with different tenancy. So, which
companies are located where might very tightly tie to which lenders have done which deals. … Do I think that
commercial brokers are more efficient, etc., because of mapping? I do. Do I think that they can be even more
efficient if they leverage a combination of mapping technology with great broker-related data? Yeah, I think that
changes the game for them.
How can brokers integrate geographic imaging systems (GIS) into their work?
Maps are cool but they’re basically two-dimensional. I want to start seeing images because I want to understand
more about the building, the physical structure of the building, etc. … GIS essentially helps you locate every
building by a specific crossing of longitude and latitude, so I can map everything across the U.S. that way. And
then I can do different things with that. Once I’ve got that GIS code, it allows me to analyze the building, the
financing, the tenants, etc., in extremely precise ways.
Risk management seems to be a huge reason for developing finance technology. Is it helping mitigate risk?
How does one understand risk and what, in fact, are the risks in commercial real estate? One risk is the property,
of course. But how about the owner? Is the owner a good owner? Are the tenants good tenants? … Tell me about
owner concentration. Is the owner [overextended] in a certain city, or in a certain asset class, that introduces risk?
… Risk starts with understanding. Understanding starts with analytics, not just anecdotes. And a lot of times,
until now, the markets function only on, “Hey, I know a guy who told me a story about such and such property
or owner.” It’s not enough to know anecdotes anymore. You need data. … Some brokers will also say, my good
name is on the line on that deal that I helped close, so I am concerned with the ongoing risk as well, because I
want to make sure that the deal that I helped close stays good. n
Ely Razin is the CEO of CrediFi, a
technology platform that powers
commercial real estate financing.
He previously served as the head
of board governance for Thomson Reuters Accelus, focusing on
the needs of directors and senior
executives at Fortune Global 500
companies. He also was the head
of business law for Thomson Reuters, covering major transactions,
industry regulation, disclosure
and corporate-governance issues.
Reach Razin at firstname.lastname@example.org.