How CRE Lenders Can Combine Excel and Cloud Reporting for Powerful Deal Management

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Built Team
5 min
PUBLISHED: 01/25/2023

Commercial real estate lenders are generating more data on deals than ever before—but efficiently accessing it is challenging. With hundreds, if not thousands, of deals siloed and scattered between various Excel workbooks, pulling data on past deals makes it that much more difficult to price during the underwriting process. Without a centralized database for commercial real estate tracking, lenders could face process inefficiencies, manual errors, and missed opportunities to make smarter investment decisions.

According to Deloitte, commercial real estate firms that invest more in technology budgets will face better opportunities to leverage efficiency into growth and opportunity. For example, instead of relying on one model over the other, consider integrating existing native Excel workflows into cloud-based commercial real estate solutions. While spreadsheets alone are powerful financial modeling tools, they don’t provide the high-powered reporting and analysis that can drive customer experience and loyalty.

Exploring the synergy between cloud reporting and Excel

Excel makes sense as a commercial real estate data tracking tool for deal underwriting and management; the industry trusts it and teams are used to working in it. But while effective, there are limitations. Relying on Excel or spreadsheets for back-end data storage, analytics, or standardization beyond financial modeling leaves much to be desired in terms of risk management, calculation errors, and hidden data. These gaps can result in missed fees, loss of interest, and late payments. It’s an incomplete solution.

Lenders should explore a hybrid approach. Utilize Excel for financial analysis and ad hoc projects that aid in the life cycle of the underwriting process, while also relying on cloud-based solutions for monitoring, accessing, and managing commercial real estate data. Digitizing data with tools that integrate with Excel helps improve data integrity and remove silos without disrupting workflows.

Harnessing operational efficiency

One significant benefit of Excel is its financial modeling, but the challenge of many legacy-based tools is friction—additional manual entries, poor user interfaces, and clunky functions make for a frustrating experience. Instead, cloud-based reporting tools allow integration between Excel and other third-party data sources, helping to centralize data and improve portfolio visibility without extra work. Consider the time saved by avoiding duplicative data entry, chasing broken links, and searching workbooks for key information—common bottlenecks that can lead to missed deadlines and stalled deals.

Digitizing data and automating reporting gives lenders a holistic view of the portfolio, from rent rolls to loan-to-value ratios across thousands of assets. This improves operating efficiency, allows collaboration between stakeholders, and gives lenders a powerful tool for creating new analyses and frameworks.

One global commercial real estate firm found that after removing data silos and consolidating technology, analysts were able to spend 80% of their time providing analysis and insights and only 20% pulling data. They took advantage of passive data to leverage more visibility into their portfolio and improve the customer experience.

Improving risk oversight

For lenders with hundreds or thousands of commercial real estate transactions, relying on individual workbooks makes it difficult to gain clarity on unique deals and the overall portfolio. Without an organized structure to mine data based on events or particular types of deals, teams need to scan thousands of spreadsheets to find critical information. When information needs to be gathered quickly, that delay can impact operations.

One typical example is weather events. If a hurricane hits the Southeast, a chief risk officer wants to know the exposure immediately. It’s challenging to gather this information quickly without consolidated reporting that’s easily accessible.

However, with a cloud-based central database, lenders can view an asset or portfolio, find the information needed, and generate a report in a few clicks. The ability to quickly mine the organized data improves risk analysis workflows.

Creating better investment decisions

Excel is a valuable tool for building workbooks and generating quick analyses. Even so, as new deals join the portfolio, it takes more work to efficiently gather insightful information to drive better decision-making. With a deal management toolkit, lenders can still work in existing Excel workbooks and simply integrate that data into a cloud-based reporting tool for portfolio reporting and management.

For lenders, viewing this data without silos allows underwriters to collaborate, incorporating deal information from other teams they may not have had access to previously. It makes it easier to pull up and review data from these deals and run reports and analytics with specific terms or conditions, such as dates and times, which may provide more insight into interest inclusion calculations, for example.

With thousands of unique data points readily accessible in a centralized database, lenders have a holistic view of the entire portfolio, including insights into the life cycle of a loan, from debt to asset. This helps lenders make smarter investment decisions, as underwriting future deals is based on high-powered reporting and analytics versus just a fraction of the data.

Overcoming potential challenges

Challenges may pop up when transitioning to new tools. It may take time for teams to get used to a different setup, and it will be tempting to apply old processes to new systems. Instead, take advantage of this transition to pause, simplify, and standardize your current processes and workflows so they can sustainably match any new commercial real estate tracking tools you work with.

With this type of technology, you’ll be able to capitalize on optimization and automation. Embracing that ability means developing best practices for integrating your workflows with these new technology solutions to get the most out of them. If you face setbacks along the way, keep in mind that any transitional slow-downs will pay off with greater risk oversight, better investment decisions, and a more efficient workflow shortly down the road.

Meeting evolving needs

Deal management and data tracking will only become more complex over time. Excel is still valuable, but the task for lenders is uncovering better ways to integrate and collaborate on workbook data to more effectively underwrite and manage deals, estimate project costs, and lower operational backlogs.

Cloud-based solutions allow lenders to aggregate data into a centralized platform, produce key portfolio reports and memos in one click, and reduce manual errors, all within a system that creates an efficient user experience with powerful analytics. As the value of the cloud continues to grow, utilize it to create operational advantages and maximize ROI for you and your customers.