Who Owns Your Valuable CRE Data?

As information management theory says, there’s data, information, and knowledge. Data is the sets of facts, figures, or other points of measurement that, among other things, companies store in computers. Pull the data together and you can get information that shows the relationship of the data points. Apply human experience and you turn the information into knowledge.

But it all starts with data, which is, as a result, a valuable commodity. It’s one that Anne Hollander, CEO of Lobby CRE, a Thirty Capital company, counsels commercial real estate companies to appreciate and guard.

That might bring a reply of “certainly, that’s obvious” from executives. But as it turns out, when it comes to computers and data, some things that would seem a given aren’t.

“One of the more controversial ideas that exists right now within commercial real estate is the idea of data ownership,” Hollander tells GlobeSt.com. “It requires an understanding first off of [whether] you value data/? Do you value what you can derive from data? If the answer is, ‘I think we’ve got our hands around data,’ you could do a better job going forward.” 

There are three aspects to this. One is understanding what a company can gain from data. Maybe there are patterns that could reveal problems and improve profitability, like improved control over cash management or uncovering a market gap opportunity in how certain types of business get transacted.

A company can improve this, but it’s also, oddly enough, probably the least of the three aspects of losing value. Next up in ascending order involves using third-party systems to store, manage, and analyze a company’s data. Often, the software platform vendors provide benchmarking information to customers but also to third parties. The aggregate information has enormous market value and the individual companies that provide their parts of the data may not get any benefit from the ultimate use.

Now for the biggest issue: ownership. This gets tangled because “property management systems have laid claim to data of operators, owners, and managers,” Hollander says. The third-party systems become walled gardens that can trap data and prevent easy access and use of other tools because there may not be a reasonable way to get access in the software systems nor a convenient way to export the data for local analysis by the companies whose data it should be.

“Data is being locked up by technology companies and intentionally so,” says Hollander. “I don’t want to speak ill of my colleagues in other organizations, but we have these legacy technology vendors that have locked it all up. You have to have the bargaining power against multinational technology companies. You’re at a disadvantage at the bargaining table there.”

What CRE companies need to do is put tools and processes in place to give themselves continuing access to their own data without needing the permission or cooperation of a hosting vendor. That requires planning, expertise, tools, and, of course, expense. But if that seems too much, consider how budget breaking it would be to get shut out for some unknown period of time from access to your own data.