There comes a point when Excel expertise can become a liability. Excel is such a powerful tool that pretty much anything can be done in Excel. And some asset management teams don’t look beyond Excel to do their work.

Here’s a conversation between an institutional investor and the CEO of a real estate development company. The investor representative is doing due diligence before committing to invest $50 million in a project that the real estate firm is going to develop and manage.

How do you think this meeting went?

Real Estate Asset Management With Excel

They were seated in the CEO’s giant office overlooking the Detroit skyline. It was a crisp Autumn morning, and the investor representative had arrived on the first flight in from Chicago.

“We are very impressed with what we have learned about your firm during our due diligence process. We think our $50 million will be in good hands under your firm’s management,” the investor said.

Hearing this delighted the CEO. “Thank you for putting your trust in us. We are an open book when it comes to our institutional partners. Is there any other information we can provide you? Just ask,” he said.

“There is one more thing. I would like to learn about your asset management processes,” the investor added.

The CEO responded right away, “I’m glad you asked. Asset management is a core competency of ours. It has been the key to delivering great valuations and distributions.”

After a pause, the investor asked, “So, tell me what it’s like work in your asset management department.”

“We have very high hiring standards. Most of our asset managers have been with us five or more years. We do hire some new college graduates from the top schools. These great people will be working for you to find ways to uncover value,” the CEO explained confidently.

The investor had a follow up question ready. “Tell me about the tools they use. What kind of analytics do they have access to?”

“They are all Excel masters. I think, collectively, our team is possesses the greatest Excel knowledge in our field. In fact, we put them through a training program that includes heavy Excel training.”. After a pause, he added, “Why do you ask?”

The CEO could sense that the investor was not impressed.


The investor responded, as if on cue, “You know we place a very high value on relationships and community involvement. But just as important, we want to see a high competency in quantitative methods.”

Not sensing any weaknesses in his pitch, the CEO responded reassuringly. “Rest assured. We have quants on the team. After all, how can you manage real estate assets without knowing rents, occupancy, expenses, taxes and all the numbers that go with it? We have been doing this for years.”

The investor continued to probe. “I agree with you,” and after taking a breath, asked, “So, other than Excel, what other tools do your asset managers have?”

“We have subscriptions to third party data services. Our asset managers need to plug in such data into their models and do benchmarking.”

The investor was not liking what he was hearing. He continued probing. “Do you have any data analytics tool for exploring data? Any dashboards for displaying property performance?”

Relieved to hear the question, the CEO continued, “Sure, we do all that in Excel. You should look at some of our Excel models. They are really sophisticated and they give us such an edge! I regularly get charts and reports that tell me how the properties are performing.” And with a proud smile, he said “We will be sending you similar reports.”

The two seemed to be on different wavelengths. The investor continued, “Umm … so the charts you get each week are created in Excel?”


“How do you pull together data for all the properties? Isn’t it useful to have historical data, starting from the day the first rent payment was collected, so we can see trends?” the investor inquired.

“Well, that’s all in the property management system. So we can always run a report each time we want to look at that data.” The CEO thought to himself that no other investor asked this line of questions.

“So, these MBAs that you have on your team run reports in the property management system, export data, and then create the summaries and charts for you in Excel?”

The CEO answered, “Yes, this process works really well. And we’ll be doing the same for you!”

The investor had heard such responses before, and felt the need to continue probing. “Does you company have a data warehouse?”

The CEO thought the investor was lightening things up. “Haha. We have industrial warehouses among our assets. But not one containing data!”

The CEO laughed at his own joke. The fund manager grinned. There was a pause. It seemed like an awkward silence to the institutional fund representative.

The investor decided he had heard enough. He also chuckled to put the CEO at ease. “Got it. Thank you for sharing that.”

“You are welcome! We have the best people and we have proven asset management methods. I assure you that you are investing with the right partner!” the CEO made his closing pitch.

“Thanks! I have some more meetings on the agenda today. We’ll be in touch,” the investor said as the meeting wrapped up.


Your Thoughts?

If you are a real estate asset manager, I highly recommend learning about data analytics technologies. Some of the popular tools that will help you in your work are Power BI and Tableau. You should also look into whether a Real Estate Data Warehouse will be useful to you.

Get in touch with us for more information.