We just caught up with ResiModel CEO Elliot Vermes before the holiday, here in town for a quick bite at the Palace Hotel (what do CEOs of year-old analytics companies eat? cheeseburgers). His NYC-based company is the only deal management, analytics and valuation platform specifically designed to speed up the underwriting process by 50% for multifamily transactions. So far, deal teams at brokerage titans like Colliers, Cushman & Wakefield, and CBRE have input more than 1,500 multifamily transactions into the platform. He used to be knee-deep in the biz himself, raising capital for large real estate funds at JP Morgan and driving acquisitions at Citigroup.
That's when he spotted two big problems with deal transactions. Deals have many parties involved--sellers, brokers, lenders--sharing and exchanging info manually. Potential buyers get handed rent rolls and historical operating statements for properties via a PDF or Excel sheet from different systems. Half the time is wasted trying to get that data into a format you can consume, he says. Second problem: deal info sits in a network drive, with no way to capitalize on the info. He met with the head of multifamily at a major brokerage firm, and he was shocked to learn how hard it was just for him to get an analyst to pull data.
Because of the crash, we are much more a rental society than we were a decade ago. It's also harder to get mortgages. He thinks fundamentals have changed. More people are renting, and that increased demand is driving prices up. At the same time, the Fed is talking about no longer holding rates at 0; that will have a negative impact on prices, he says. That means we might be at a peak--not because of real estate fundamentals, but because of the capital markets. The nice thing about his platform is it can adapt to any market. If it's very active and people want to underwrite as many deals as possible, the platform opens up more time to do so. That means no longer missing out on diamonds in the rough because they didn't have the time to underwrite them. And if a market crashes, you need to do more with less. Having tools like his helps, he says.
