How to Optimize Your Global Commercial Real Estate Management Using Proptech Software

3. Fluid Collaboration between Real Estate and Accounting Departments

Large enterprises have complex departmental structures to operate more efficiently. However, it is important to organize knowledge and data sharing between departments to avoid silos and duplicated work.

Lease managers, real estate managers, and their accounting teams often lack streamlined communication and collaboration. This is counterproductive since these teams need input and approval from each other to proceed in their work. Slow collaboration between these departments can not only lead to delays but also contribute to lost revenue. For example, we have often seen accounting teams pay for leases that were closed months prior because they weren’t informed about their termination.

When you work in a large enterprise, it is hard to make these miscommunications and errors visible. However, leveraging current technology helps. Having one source of truth for all teams and allowing them to collaborate in single software with dedicated and tailor-made workflows can be a game-changer.

Before, there was a lot of work duplication; accountants needed to manually add information to their general ledger, and real estate professionals added the same data in their separate property management system (database or legacy software). However, with a single source of truth, once a property manager adds the lease contract information, it is automatically available to the accounting team. Using CRE software, when a property manager adds a new lease contract, all the information can be transferred to the accounting team, pre-formatted under the right categories and subledgers, simply awaiting their approval. When it’s approved, the property manager gets a notification, and the contract data is saved in the General Ledger of the ERP system for further use. There’s no duplication of manual data entry, only a streamlined workflow.

Another crucial example where real estate and accounting teams need to collaborate side-by-side is in compliance. Accounting teams need to make sure that property managers provide all the necessary information for real estate lease assets according to the correct accounting standard. The right proptech software consolidates data into a single source of truth for both teams and would automatically format the lease contract data entered by property managers to the appropriate accounting standard. Accountants can then complete reports more quickly and ensure that the standards required by compliance are accurately followed. Month-end closes and audits become much faster and more efficient as an additional benefit.

A word of caution should be added here: for such smooth collaborations to happen, it is not enough to just use any one single software for both teams. Sometimes companies ask real estate professionals to use solutions designed for accountants, and this works poorly. We cannot forget that real estate professionals and accountants have different goals and require different features to achieve them. For example, for a property manager it is important to know the exact square footage and type of lease (warehouse, store, or pick-up point) whereas for an accountant it is more important to ensure compliance and regular payments. That’s why you need to make sure that the software you choose will not only offer data centralization but also will have all the features crucial to both teams.

1. Smooth data exchange between teams ensures accurate financial reporting, compliance, and forecasting. It reduces manual errors and work duplication.
2. Less time is wasted on chasing people from another department. The software notifies people about the need for approval and when it is received.
3. No cost incurred from paying for closed leases.