Top 5 Tools for Managing Renovations

Real Estate portfolios strive to increase asset value by pursuing renovations and other strategies. Yet the tools available to manage such strategies haven’t changed dramatically even as technology has continued to evolve. To understand the pros and cons of the various available tools, one needs to understand the key criteria considered to renovate. Then, one can analyze the most popular software tools against these criteria.

The decision to renovate is typically financially driven and can be determined looking at the expected revenue gains and costs versus not renovating at all. Given that renovations require a unit to be vacant, a company must manage their renovation schedules to minimize vacancy loss within reason. If not paying close attention to all of the activities required to be coordinated between staff and suppliers / contractors, renovations can easily drag on much longer than expected, resulting in higher costs and greater challenge in meeting the financial goals.

With this in mind, we provide what is believed to be the most important criteria for evaluating a renovation software tool/solution:

• Does it track financial performance of the renovations over time?
• Is it user friendly and intuitive?
• Does it allow for easy data collection (including pictures) for efficient reuse for future tasks?
• Does it enable efficient collaboration with suppliers and staff?
• Does it provide execution insight allowing for proactive decisions to save money and for ensuring critical tasks are completed?

Renovation Tool Criteria

Financial Performance Tracking

When undergoing any investment, it is critical to understand whether the investment is projected to miss or meet/exceed target thresholds. After all, if the investment is not going to provide sufficient returns, why invest.

Once the investment is made, it is important to know how it is progressing in comparison to projected financial goals. Getting financial performance information in a timely manner is critical when assessing progress. This is critical decision-making insight to know if and when to accelerate or decelerate the renovation schedule!

Familiar Tools

Whenever staff uses new or unfamiliar tools, they experience a challenge in learning or relearning how to use them; regardless, how simple and user friendly they are. Understanding how to use the tool within your process is often what creates the most confusion. The easier the tools are to use and the increased frequency the staff uses them, the more successful the staff will be at using the tools efficiently and effectively during the renovations.

Easy Data/Picture Collection and Re-Use

When using multiple tools that require separate data entry (e.g. inspections, fixed asset, procurement/invoicing, work orders, etc.), the extra steps required to enter data will either not be done or be completed late with user frustration. The more data a single tool can collect and allow for reuse over the renovation process, the happier and more effective/efficient the staff will be.

Collaboration

Many tools are online and allow for the sharing of information among staff and suppliers / contractors. Sharing is great, if it is done with the right people at the right time and it positively impacts the renovation process. Iterations are common and expected in the renovation process to ensure the right work / product is used to achieve the desired financial goals. This collaboration in creating critical transactional documents is a must to ensure the process continues to move forward and baselines are defined efficiently; after all, time is money.

Save Money, Manage Tasks

At the end of the day, it’s all about the money made and the money saved. Generally, if the tool is helping you to operate more efficiently and make better (and timely) decisions, it is going to be helpful for you. So, understand the insights the tool can provide during the renovation process that allow for timely and accurate decisions.

Potential Solutions

Excel on PCs

The spreadsheet was truly a great invention. Some argue, that it was the killer app for the IBM PC – who could argue with that. You could make calculations, sort and summarize data, and figure out answers to questions in an order of magnitude faster than you could before.

Pros

• Exists, old, familiar and predictable – comfort zone
• Very flexible in creating different financial models
• Can track both financials and tasks

Cons

• Challenging to share with version control issues
• Difficult for many people to understand the model
• Lots of work to keep up with data entry
• Managing large projects is inefficient and difficult
• Mainly supports financial modeling of the process

Online Spreadsheets and Databases (Excel Online, Google Sheets, Smartsheet, etc.)

Microsoft has versions of Excel available online, so users can collaborate on or share a spreadsheet. Similarly, Google has Google Sheets which allow concurrent collaboration on an online spreadsheet. Smartsheet has gone beyond that with more complex versions of online spreadsheets.

Pros

• Somewhat flexible in creating different financial models
• Can track both financials and tasks
• Allows for sharing across different internal groups

Cons

• Can share data within the team, but less flexible in creating controls over who can see or do what when sharing outside of the core team
• Unique to each effort taking a lot of work to build and maintain the system
• Lots of work to keep up with data entry
• Managing large projects is inefficient and difficult
• Mainly supports the financial modeling of the process

Online Database Software (Airtable, Ragic, Zoho, etc.)

Online databases such as Airtable, Ragic, Zoho, and others allow organizations to create forms tied to database tables in an online database.

Pros

• Can track both financials and tasks
• May be easier to update using data from other systems
• Easy to collect information and present current results

Cons

• May not to support all of the calculations needed
• Unique to each effort taking a lot of work to build and maintain the system
• Managing large projects may be inefficient and difficult

Comprehensive Real Estate Renovation Software (like FacilGo®)

Renovation tools / solutions for the real estate industry are typically a potpourri of various applications such as Excel and real estate specific modeling tools that require data re-entry and manual updates to assess progress.

Pros

• Uses features built into the operational process minimizing data entry and user unfamiliarity
• Specifically built to handle renovation projects
• Can track both financials and tasks
• Provides a collaborative environment for staff and suppliers

Cons

• May be a system that you are not currently utilizing

Conclusion

Being able to model and track the renovation process to understand progress toward achieving defined goals is paramount to the tool / solution selected. Providing a single comprehensive solution (versus disparate tools) that is familiar and easy to use by your staff allowing them to easily capture and reuse data supporting continuous collaboration with your suppliers / contractors enables efficiency and proactive insight to the renovation process. Keep in mind that this renovation tools evaluation assumes you were pursuing a large multifamily renovation project (or renovation projects on a substantial number of single-family homes). Be aware, there are many tools available in the market for managing the renovation process beyond spreadsheets. The importance of each criteria for your organization will be different than other organizations, but evaluating the available options against those criteria will help you better understand which tool / solution best meets your needs.