Developers are united in one universal struggle: Excel. Excel is the industry standard tool in Commercial Real Estate. It’s the most widely used program for both lenders and developers but the least favorite program or tool for both groups. Excel’s impact on the industry goes beyond wasted time. It results in real money being mismanaged or lost.
- Teams spend 31% of the time dedicated to each project on unproductive communication
- 35% of development managers’ time is spent on non-productive activities
- 69% of cost overruns are over 10%
- The industry standard for cost overruns is 85%
Luckily, affordable technologies exist today that leverage automation to automatically alert developers regarding issues on their project finances. For development managers, that means tracking project costs in real time and easily dealing with change orders or other unforeseen issues. If you know where things stand at all times, you always know where you can pull from in the budget to cover changes. When budget issues or data discrepancies do occur, software can alert you immediately rather than when it’s too late.
For example, to optimize project ROI, it’s important to ensure individual line items don’t overdraw and have supporting invoices or documentation. Unfortunately, manually reviewing line items takes a lot of time and is susceptible to human error. Instead of going line by line, today’s development management software can automatically flag items that require the reviewer’s attention. This saves hours of time as the software instantly detects inconsistencies or errors in the data. As a result, you spend less time searching for errors, giving you more time to strategize on budget and risk management as the project progresses.
Automating tasks like those related to budget reconciliation gives development managers better visibility into where their project finances stand in real-time. Without automated processes, the cost of inefficient systems can pose a real problem for development managers. Lenders and equity partners are counting on developers to provide timely information, keep projects on schedule, and stay within budget. Developers with better reporting and portfolio visibility are the ones that lenders trust to handle these tasks well. When economic conditions improve, those modern developers will be first out of the gate to acquire new deals. This begs the question of how much longer developers can keep crossing their fingers and using Excel.
Forward-thinking developers are looking ahead to 2025 and understand that to be first out of the gate, they need to solve the issues created by Excel by embracing automation now. If you’re ready to see how your projects can benefit from automation, reach out to our team to see modern development software in action.
