When Fintech Finally
Meets Proptech
There have been
many advances in
CRE technology, but
few in the lending
arena specifically.
But lately, there have
been hints that this
is beginning
to change.
As a servicer, it is Trimont Real Estate Advisors’ job to analyze loans and payments. It collects the amount
due from the borrowers and applies the
money against the balance of the loan. It
maintains and calculates the debt service
coverage ratio, the covenants in the loan
documents, and reports everything back to
the client.
The client is happy to get the
information, but Max Ellerhorst, managing
director of Data Solutions for Trimont,
knows what would make the client even
happier. What if, instead of telling the client how the loan has just performed for
the previous month, Trimont is able to
predict, say, that the loan will continue to
perform well for the next three months but
in the fourth month there will be a payment problem. If the client knew this in
advance, it could develop a strategy to
appropriately manage the borrower.
Trimont is working on developing such
a system and hopes to have a client-facing
version out before year’s end. The company is in the process of securing the necessary data sets such a system would
require. It will then will use analytics to
predict where the payment sequences are
going to go.
In the larger tech space, such a feat is
not that significant. Predictive analytics—
which is essentially what Ellerhorst is
describing—is a well-developed technology used in multiple industries. But then
again, commercial real estate has always
been somewhat of a laggard with technology and still is, despite some claims to the
contrary.
“What commercial real estate lacks is
transparency—it lacks information
standards at an enterprise level,” Ellerhorst
says. “It lacks a strong basis for transferring
data from organization to organization.”
Finance Focus | Creative Capital
By Erika Morphy
