Nuveen Adds 10M Square Feet to Digitized Lease Abstraction

Giant investment manager Nuveen is adding an additional 10 million square feet of its life sciences and office portfolio to its cloud service from Prophia.

The vendor focuses on abstracting data from leases to make the financially relevant information available to investors.

First, an institution will upload its leases into the company’s cloud platform. Prophia’s software uses machine learning and human review to largely automate the extraction with human experts  to identify missing information in coordination with the client. Once the data is available, the investor can share its information with an unlimited number of recipients. Once data is in the cloud system, an investor can upload additional material, so the information continues to be recent and accurate.

The digitization process should add to efficiency. Leases can contain extensive information necessary for a full analysis of expenses and financial responsibilities necessary to understand profitability of a property, as well as managing tenant details like rent steps, security step-down clauses, and exclusions. At a time when inflation is still elevated, keeping track of how much tenants are supposed to pay is critical. Importantly, the data comes from one source rather than having personnel riffling through cabinets worth of data.

“We rolled out Prophia in staggered stages, but we wanted to have a comprehensive view of all lease data points and a platform that facilitates easy navigation and reporting,” Mark Meehan, director of office sector for Nuveen Real Estate, says in prepared comments. “Prophia excels in managing the complex data within contractual documents throughout the entire lease lifespan. While deal workflow is essential, we recognized Prophia’s unique qualification to handle data management beyond lease execution.”

Nuveen first started using Prophia in late 2022 with a pilot project of Millennium Tower, a 20-story LEED Gold and Energy Star certified building in Seattle, with 201,322 rentable square feet across 6 residential floors and 14 commercial. The building had multiple ownership entities, complicating issues.

In December 2022, Prophia announced that it had raised $10.2 million in Series-A fundraising. Cercano Management led the round. Also participating were SignalFire and several customers. Prophia had previously raised $5.1 million since its first seed round in 2018. The firm didn’t announce what it planned to use the funds for.