CRE Appraisers Spend Nearly Half Their Day On Busywork. One Firm Is Using Tech To Change That
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The appraisal is one of the most important and least understood parts of a commercial real estate transaction. It is often the first item to be ordered in a CRE deal and the last to be delivered, and the process that happens in between can be complex, inefficient and bogged down by endless busywork.
“When I first started working in the appraisal industry, I spent 40% to 50% of my time gathering information, formatting charts, photos and tables, and generally doing manual busywork,” John Meadows, co-founder of CRE appraisal firm Bowery Valuation said. “My co-founders and I wanted to create a more efficient, technology-based system to streamline that work.”
Meadows and co-founders Noah Isaacs and Cesar Devers started Bowery with the goal of creating better tools for appraisers that would increase data accessibility while giving them more time to spend on thoughtful valuation and client service. Bisnow recently talked with Meadows to learn more about the pain points of the appraisal industry and the tools Bowery has designed to help solve them.
Bisnow: What gave you the idea to start a commercial real estate appraisal firm?
Meadows: Noah and I used to work at one of the largest independent commercial appraisal firms in New York City, and while we were there we were shocked by how antiquated the process was for us to produce these incredibly complex and important reports.
Appraisers are spending a disproportionate amount of their time on manual busywork and working in a way that makes it incredibly easy to have substantial errors in the reports. We found that nearly half our time was spent gathering data from 10 to 15 disparate sources, formatting photos and tables and using Microsoft Excel linked to a Word document to write 120-page reports, while using the same templates over and over for different assets.
At Bowery, we’ve really tried to rethink the appraisal process from start to finish. We’re not working to change appraisal methodology or the way an appraiser makes valuation decisions — every comp, every cap rate is still selected by an expert appraiser. We simply ask ourselves how we can make the process better across all of the unique areas of the report and every interaction with our clients?
Bisnow: How is your approach different than other appraisal firms?
Meadows: The end product we produce, the appraisal report itself, is the same as any other commercial appraisal firm. However, we arrive at that end product in a very different way. Our team of appraisers uses our proprietary software to add efficiency to the appraisal process and avoid easy-to-make mistakes throughout the report.
Our appraisal team also works directly with our product and tech team to provide feedback for improvements and new features that will continue to help them do their jobs more intelligently and efficiently. We have a mobile app, for example, that ensures notes and photos taken from a property inspection are always inputted and stored correctly, as well as formatted perfectly in the actual reports. Each one of our reports is written from scratch, not by using an old template from a different property, ensuring no property data or errors are left in from an old report.
Our software links directly into publicly available databases to pull accurate property information from different sources, so our appraisers do not have to spend time pulling the same info from different sources in every report. These are just some of the dozens of ways in which we’ve added efficiency and intelligence into the appraisal process.
Bisnow: Why are tools like Bowery’s important to appraisers?
Meadows: Appraisers have one goal: to provide the most accurate valuations to their clients. Tools like ours give appraisers more time to speak to brokers, confirm the comps and really understand the depths of the property and market that they’re looking at. This helps ensure they are giving their clients the best possible final product, and spending their time on thoughtful valuation instead of busywork.
Bisnow: How does the Bowery approach impact clients?
Meadows: Traditionally, service has not been the main focus of the appraisal industry. We emphasize hospitality in the same way a five-star restaurant or hotel would. We have our appraisers go through service training as part of their first week at Bowery and we employ a traditional client service team to help manage client needs.
We’re also working on a client portal to help provide more transparency for our clients regarding the status of reports, information that’s still outstanding and a way to order reports in a more streamlined manner.
We believe that bringing a service-oriented approach to a traditionally under-serviced industry will go a long way toward bringing greater transparency to the appraisal industry as a whole.
This feature was produced in collaboration between Bisnow Branded Content and Bowery. Bisnow news staff was not involved in the production of this content.