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Demand for data drives up as real estate capital markets activity snowballs

A significant uptick in the commercial real estate debt markets has increased demand for underwriting and analysis services.

CW Capital’s RealINSIGHT proptech arm believes there is more need for data in the real estate debt space as lenders and borrowers require a more thorough understanding of specific nuances of the market at a time when investor confidence and capital flows continue to climb.

“There is a real need to understand what the top private equity firms, investment banks and hedge funds lend on and what’s the makeup of their portfolio – and technology is just becoming more and more necessary [for this reason],” Dan Linder, managing director, told Real Estate Capital USA.

The firm is seeing greater confidence in the debt markets as well as more investor demand for commercial real estate debt as an asset class. “There’s been [growing] optimism, more activity, and we’re seeing an increasing need for leveraging technology so that [firms] are able to determine what their risk factors are, [measure] the speed and efficiency [of their activity] and underwrite something even faster and getting more eyes on it,” Linder said.

CW Capital in 2012 acquired RealINSIGHT, a cloud-based investment management system for loans and real estate. The platform provides investors with a tool that integrates with external systems, stores comprehensive data models, alerts users when key events occur, and delivers customized reports and analytics to the desktop.

“Our clients are growing their portfolios, they’re dealing with compliance, they’re dealing with regulators, they’re dealing with rating agencies and they have to both report internally and externally. And in order to do that, data helps people make decisions. [But] you also need to provide confidence to your investors, to your management team, even to your borrowers,” Linder said.

The platform’s clients include private equity firms, hedge funds, investment banks, commercial banks and debt funds that play in variety of areas, including CRE CLO, bridge loans, construction loans or CMBS.

“The thing that they have in common is they all have some commercial real estate strategy,” said Linder. “They invest in debt, they lend, and we are talking billions of assets under management. [Data] can be used to help manage hundreds of thousands of loans and properties and get answers to questions, which aren’t always easy, and so it’s very important to have a platform that allows you to make thoughtful decisions.”