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When inaccurate data creates financial risk, a comprehensive data platform is needed for faster, better-informed decisions

August 22, 2023 5 mins

This article was written in collaboration with Bisnow.

Each year, U.S. businesses  lose more than $100B  because of data inaccuracies. In an industry such as commercial real estate where data miscalculations can affect projected revenues, expenses and, consequently, investment performance, the accuracy of data is key to success.

While the business data and analytics industry is expected to grow to $33B by 2025, the past few years have shown that overcoming uncertain market conditions requires immediate access to precision data today. This is particularly true in CRE, where companies can get bogged down navigating the capture and standardization of the large quantity of data available to make it actionable for driving strategy and revenue growth. 

LightBox,  a CRE data and analytics firm, through its engagement with more than 25,000 customers, hears this market feedback firsthand. Through supporting the CRE ecosystem end-to-end, the company sees the need for data continuity to drive decision-making through varying points in the transaction life cycle.

“A recent  LightBox  survey of all users found that customers are relying on data and technology to improve current workflows and increase efficiencies,” LightBox Managing Director of Enterprise Data  Caroline Stoll said. “But bringing data management to their internal systems can seem overwhelming — especially in the midst of the macroeconomic headwinds and an increased need for data to drive end-user action quickly.” 

This is where LightBox comes in, she said. Recognizing that inaccurate data creates financial risk, the most successful CRE companies have given considerable thought to solving this challenge. As a result, these firms are relying on more accurate data to thoroughly understand the opportunities and risks of a particular asset, portfolio, or entire market or asset class.

The explosion of data

In recent years, there has been an explosion of data accessible to the market. Data availability is a great step forward, but mass amounts of data aren’t actionable if they are unstructured, unstandardized and fragmented.

Many companies and firms pull data from varying sources for a specific analysis, report or research, but to reach a comprehensive solution, the business must establish a foundational dataset to build on, Stoll said. This creates continuity in data standards and governance and therefore consistency in the information that is being used to drive decision-making. 

LightBox was formed to support the commercial real estate ecosystem end-to-end through workflow tools and data.

“To achieve this, we have collected, standardized and connected the core building blocks of property data to give context about a property on a national scale with our commercial product, SmartFabric,” Stoll said. “We leverage our LightBox Identifier, or LID, which persists over time, making our data easy to integrate with a firm’s proprietary data or other third-party data. We enable our users with a holistic view of any property, portfolio, market or asset class they are interested in.”

Stoll said CRE can learn from other industries such as financial services, which went through a similar digital transformation 25 years ago. It now benefits from well-defined standards and data accessibility for immediate decision-making. 

“With our commercial products, tools and connected data infrastructure, plus the extensibility created by our LID and Digital Solutions Team, LightBox is uniquely capable of supporting any CRE firm — regardless of where they are in their digital transformation journey,” she said.

Beginning the CRE digital transformation

Whether firms are using digital technologies to create or modify business processes, the LightBox data platform helps developers, investors, builders, brokers, lenders, government workers and others make data-backed decisions that will help their bottom lines. From the asset level to the market or national level, LightBox solutions map to every use case, however simple or multifaceted and technically complex. 

Stoll said LightBox’s SmartFabric is platform-agnostic and flexible in its delivery. This includes bulk-feed application programming interfaces via the LightBox Developer Portal and end-user tools like its map-based geospatial analytics platform, LightBox Vision, which enables both technical and nontechnical end users with robust search, analytics and data visualizations. 

“We’ve collected more than 10,000 disparate datasets and 2 petabytes of data to provide an unparalleled national property database,” LightBox Director of Enterprise Market Strategy  Daniel Kiachko said. “We became masters of applying unique and persistent identifiers and in change management. This allows our clients to tag their own proprietary and third-party data to our deep database, all connecting to their platform via the LightBox information database.”

Regardless of where clients got their analytics, when a property comes through the LightBox system, it is tagged with a LightBox ID. The firm attaches everything it knows about that property — including address points, building footprints and parcel boundaries — and sends it over to the client’s system. Clients can then call up everything they have attached to that property in a clean, standardized fashion. 

This efficiency is especially important when markets become volatile due to high interest rates and inflation. In this environment, speed to market and precise analysis can make or break a deal.

“Our investor and developer clients are often looking to qualify or disqualify a property as quickly as possible so that they don’t waste time evaluating properties, deals or opportunities that are not going to meet the requirements,” Stoll said. “The velocity of opportunity qualification, because of the data available, creates efficiencies and gives time and focus back to driving worthy deals.” 

Confidence in their ability to understand opportunity and risk is essential, particularly in times of uncertainty, she added. Whether they are asset characteristics, market trends, or climate and environmental data, LightBox gives its customers the data they need for due diligence, business intelligence and strategy, she said.

What’s ahead

LightBox’s data and technology execution and initiatives are intended to optimize its customers’ interactions with and understanding of information. Giving people unrivaled data and tools will revolutionize the way they do business, Stoll said.

In the era of climate change and its far-reaching implications, access to accurate and comprehensive climate data is crucial for businesses to make decisions. Efficiently managing and connecting vast amounts of data poses a significant challenge, especially when there are multiple sources and vendors providing climate models and datasets. 

Looking ahead, LightBox recognizes the critical need for a comprehensive and accessible climate data management solution that fits the end user’s need.

“LightBox has partnered with various climate vendors, supporting data compatibility across providers,” Stoll said.

This approach connects climate data from top vendors to SmartFabric and enables customers to easily consume and extract insights from the climate model of their choice, all associated with specific properties using the LightBox Identifier, she said.

“The industry desperately needs benchmarks, standardization and data accessibility,” Kiachko said. “We are the first provider to bring this to bear and support the commercial real estate ecosystem and transaction life cycle end-to-end.”

To view LightBox’s connected data fact sheet, click here.

Photo credit: Unsplash/Wojtek Witkowski

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