As smart technology and AI tools become more and more popular, the most successful commercial real estate professionals have increasingly turned to these resources to help run their businesses.
By leveraging automation tools, these businesses stay at the cutting edge of technology, helping them stay more efficient and more informed.
n this article, we’ll go over how you can take advantage of automation in your commercial real estate accounting practices, including the biggest benefits and the most useful automation strategies and tools.
One of the biggest benefits of automation is the ability to reduce time-consuming tasks into quick processes that only take a few clicks. Computers can process data and make calculations much more quickly than humans, allowing you to free up time to focus on business growth.
In addition to being much quicker than humans, computers are also much more accurate when it comes to making complex calculations or entering repetitive data. Even the smallest errors in data entry or financial calculations can result in misleading reports or lost tenant trust. Automation offers a reliable alternative that saves you from hours hunting down tiny mistakes and re-checking calculations.
Efficiency and accuracy mean that it’s also much easier to create useful, specific reports and monitor compliance. Many programs that offer automation tools also automate these features, allowing you to instantly generate the reports you need. They can also monitor your data for compliance with key standards and give you an alert if there are potential issues.
If you’re considering implementing automation in your commercial real estate business, the best place to start is by identifying current issues. What are the tasks that are repetitive, time-consuming, and error-prone? These are excellent spots to prioritize automation.
Look for accounting and property management tools that offer automation in your target areas, and introduce the new workflows slowly, so that employees and tenants are well-prepared. In addition, be sure to ask for feedback, both from tenants and from your team, so that you can solve any problems quickly and make the process as easy and efficient as possible for the people that use them most.
Many different aspects of commercial real estate accounting can benefit from automation, and it’s important to assess your particular needs when deciding where to start. However, these are a few of the most common pain points that automated tools can make much easier.
Common area maintenance (CAM) reconciliation is an excellent place to take advantage of automation. Proper CAM reconciliation involves keeping detailed, accurate records of expenses throughout the year, billing tenants an estimated amount to cover these costs and then performing complex calculations to determine what they still owe (or are owed back). You must also take into account special agreements and lease conditions. Some commercial property management software, like STRATAFOLIO, automates reconciliation so you can perform it in just 1-click, providing fast, accurate results every time.
Rent payments and proper invoicing are processes that often get overlooked in commercial real estate. Owners assume that tenants know what and when they need to pay and may not feel the need to send out monthly invoices or keep a close eye on payments. However, these small oversights lose commercial real estate businesses huge amounts of money over time when tenants miss payments or rent escalations due to lack of information. Avoid these issues by setting up automated invoices that bill tenants for the correct amount each month, and an easy-to-use tenant portal that will alert you to any payment issues.
Automatic report generation saves you time while focusing on exactly the information you need, from property-specific details to portfolio-wide analyses. Some programs can also tailor reports to different audiences, including your team, investors, and tax officials.
Set up alerts and reminders across your workload to stay updated without having to manually run through every piece of information. Receive reminders for important dates like lease endings and rent escalations, which can be major losses if missed. Be notified quickly of problems with rent payments, compliance issues, and more with automatic alerts that allow you to address concerns quickly.
When choosing automation tools for commercial real estate accounting, it’s important to pick programs that provide the services you need and will be easy to use. One common choice is QuickBooks, an accounting software popular with small to mid-size businesses because it is well known and offers a wide variety of tools, including automations that can help with data entry, analysis, and invoicing.
However, commercial real estate businesses may need additional tools to handle industry-specific needs, including rent payments, leasing, and CAM reconciliation. In this case, the best option is commercial property management software like STRATAFOLIO that integrates directly with QuickBooks, meaning that you can use automated tools in both platforms but only have to enter data once.
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Feature submission by Jeri Frank. This adapted Insightful Accountant content is provided for informational and educational purposes.
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