02 Oct 2023John Macdonald

3 ways to optimize NOI on your commercial real estate portfolio

As a Commercial Real Estate asset manager, your primary goal is to maximize the net operating income (NOI) of your portfolio.

The process of optimizing the portfolio means that there are often multiple decisions that need to be made each month, if not daily, to drive annual improvements.

In the past, asset management and other data driven processes were more straightforward since we typically relied on smaller amounts of data that focused on one more variable. Management was relatively straightforward as Excel spreadsheets were used to handle simple tasks using V-lookup and other common formulas. It was also easy if an experienced manager was available to customize and tailor the monthly reporting systems so that the office knew what was in the data and how to run through the same process each time the data was needed. 

Today, we are surrounded by multiple data sources and all sorts of information that is difficult to manage well with manual human processes and reasoning alone. 

You may need to come up with creative ways to make sure your properties remain attractive to tenants and strategies to maximize the overall financial outcome. At the same time, you are also responsible for managing the day-to-day operations, monitoring financial performance of the portfolio, and reporting back to stakeholders. This is a tall order considering the level of data management required to keep track of and analyze all your properties. 

Today, managing asset portfolios to maximize profits and increase net operating income is best achieved with a 360 degree view of all tenancies and leases. Without this, important details and timely notifications, such as lease expirations and reconciliation of payments, are subject to becoming lost in a sea of documents or being mismanaged by other account teams who may or may not be on top of the right details. 

Seeking to maximize operational efficiency is essential – the workload is intense at the best of times. Using the right new technologies can substantially reduce manual effort, driving productivity. The ‘day job’ just got a lot simpler and more efficient, leaving time in the day to add value, find solutions and stress test options.

Asset managers typically find their time and efforts are challenged or consumed by:

  • Document inefficiency – Where is that information?

    It’s everywhere – stored in documents that include Excel spreadsheets or other haphazard file systems often result in missing key deadlines or data that can easily lead to financial loss. This may include unexpected lease expiries, missed deadlines for contract renewals, or negligence around other timely information that should be included in important reminders. These missteps can be costly for the asset manager as mistakes may become manifest in the NOI.

  • Time lost reconciling tenant payments – Where is the cash?

    Having to go back and forth with the accounts team every month to reconcile discrepancies in tenant payments (tracking actuals against forecasts) takes a lot of time. After uncovering tenancy disputes, tenants must then be chased for payment, consuming more time as details appear to be lost in translation.

  • Time wasted creating month-end reports – So many people to keep in the loop!

    It’s all too easy to spend too much time at the end of each month creating nice looking reports. It’s arduous and tedious, particularly when using Excel or Powerpoint for reporting back to investors on vital KPIs. It is important – it keeps stakeholders informed about the health of the portfolio as well as providing critical information needed to make strategic decisions about the properties. Making it comprehensive, maybe even online, also reduces the ad hoc queries.

Streamlined reporting is the missing piece, essential for managing data 

Overall, a lack of consistency in storing and accessing information and data will prove costly. It leads to frustration in resolving queries and resolving the important issues each month. Without streamlined reporting across the business, it’s difficult to see the bigger picture to be able to improve NOI. 

Technology platforms are the key to operational efficiency

Fortunately, asset managers can accelerate their processes by providing a more efficient means of working with information. Good technology platforms, with rich data, move asset management away from relying on manually derived processes. 

The effectiveness of a technology platform lies in its ability to acquire accurate data quickly and to concentrate that information into a single source of truth, making it easier for asset managers to produce consistent documentation for all stakeholders who may need various data periodically, and as importantly, on demand. 

By consolidating information and activity, the asset manager can automate many aspects of their daily tasks. Being notified, we know when leases are coming to an end, and when supplier contract renewals are due. Setting essential reminders will enable them to be proactive rather than reactive, leading to more profitable outcomes and less chances for the needless and unexpected loss of income. 

A centralized data platform helps you understand all aspects of your tenancies, supplier agreements and overall occupancy. A good outcome from this would be better tenant experiences that will help facilitate occupancy rates that ultimately increase profits. 

Data platforms also save time and eliminate losses by facilitating more seamless connectivity.

Automated links between your platform and your third-party accounting system makes it far easier to access and visualize bank account details and track payment errors, meaning you can avoid having to spend time and energy speaking to various accounts personnel who may not even have direct access to the right records.

Technology platforms can deliver superior management reports that provide for all stakeholders.

Instead of piecing together disparate sources of information in PowerPoint with Excel snapshots, technology platforms can automate the creation of professional and visually optimized management reports that will update investors with critical management information. You will be able to show how well your properties have performed compared to the previous period and reports can also be refreshed easily by the click of a button. Some example reports might include income vs expenditure, cash flow statements, rent roll, expense reporting, capital expenditure reports or a debt service report. 


Improving your operational efficiency will result in improved NOI. When your asset data is stored centrally, you’ll be able to keep on top of property management and unit occupancy and get regular reminders that prompt you to attend to important activities like expiring leases and contract renewals. 

An integration with your accounts system allows you to see which tenants haven’t made payments and find out why without wasting other people’s valuable time. 

Reporting can easily be done using dashboards and other management reports and means you can show improvements in your net operating income to investors and stakeholders in seconds rather than minutes or hours.