How property companies can optimise their front and middle office

Property companies are currently operating in a challenging environment. A recession is expected in 2023 with negative impetus for the construction and property industry, the interest rate situation remains tense, the scope for financing is narrowing and investment volumes remain low on the transaction market. In addition to these macroeconomic developments, the property industry is confronted with new ESG reporting requirements.

In view of these multiple challenges, property companies must adapt their corporate strategy, business model and target operating model (TOM) in order to become more cost-efficient and secure their long-term profitability.

One important aspect of this is the optimisation of performance in the front and middle office. The current issue of the Real Estate Bulletin focuses on this, as we believe that the corporate functions in these two areas offer a great deal of potential for optimisation.

A rapid return to the exponential growth of recent years is highly unlikely. Significant increases in value can no longer compensate for costs caused by inefficiencies or insufficient digitalisation. This means that the performance of the front and middle office must now be analysed and optimised with suitable measures.

In the specialist articles in the Real Estate Bulletin, the experts from KPMG and KPMG Law highlight starting points and recommendations for action that can be used to sustainably improve front and middle office functions. One important lever here is digitalisation.

They describe how a continuous improvement process can be implemented to increase efficiency, effectiveness and competitiveness.

Great expectations are placed in particular on the use of artificial intelligence (AI), which we look at in two articles: firstly in the due diligence of M&A transactions in the real estate sector and secondly in property management. How can AI make processes more efficient and what are the prerequisites for this? You will find the answers in the two specialist articles.

You can also read in the Real Estate Bulletin how property valuations and their order management can be carried out in a time and cost-efficient manner using digital solutions and how the tax department should position itself in order to fulfil the requirements placed on it when involved in real estate transactions. You will also find out why now is a good time to think about setting up your own real estate capital management company (KVG) and optimising existing KVGs.