Investing in operations, how proptech delivers measurable NOI

In this episode, Ashkán Zandieh from CRETI, the Center for Real Estate Technology & Innovation, joins us to explore how investor-led, operations-first proptech is driving measurable NOI, as well as about where capital is flowing—electrification, fintech infrastructure, and applied AI—and the KPIs and guardrails property managers need to evaluate real ROI. To learn more about CRETI, visit creti.org. 

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Transcript

Erin:

Welcome to another edition of From the Front Lines, where we discuss both the day-to-day, and one-of-a-kind issues facing real estate managers. And welcome to our final episode of the year! Before we dive in, we’d love your feedback to help us make this podcast even better for you. We’ve created a short survey, and your input will help guide us. The link to the survey is in the episode description, and it will be open until January 16th. Please take a few moments to share your thoughts…we really appreciate it! In this episode, Ashkán Zandieh from CRETI, the Center for Real Estate Technology & Innovation, joins us to explore how investor-led, operations-first proptech is driving measurable NOI, as well as about where capital is flowing—electrification, fintech infrastructure, and applied AI—and the KPIs and guardrails property managers need to evaluate real ROI. To learn more about CRETI, visit creti.org. Welcome to the podcast, Ash.

 Ash:
 Thanks for having me, Erin. How's everything?

Erin:
 Oh, everything's good. Thank you. All right. And our first question, where is venture capital actually flowing in proptech, and why should property managers care?

Ash:
 So that’s a really great question to kind of start with because the industry has really moved along over the past 10 years and we had a bump in the road last year and I think this year is really proving out to be a monumental year for proptech and three trends really stood out. One is the electrification of assets across commercial and residential and just energy in and of itself. Second trend was operating systems for owner managers and moving from nice to haves to need to haves, especially around financial plumbing and I'll kind of double click on that in a minute. And the third one is AI that eliminates variance, not just headcounts, and you heard that a lot with the advent of AI over the past two years. The narrative is that it's a job killer. The reality is it is not a job killer. And we're identifying where adoption is taking place and where the real value is being created for the industry.

Erin:
 Sounds great. And what operational KPI's should we use to evaluate new tech in 2026 budgets?

Ash:
 So that's a great question and kind of double clicking on the operating system for owner managers, the industry is moving off of nice to haves to need to have and especially around financial plumbing and infrastructure plumbing. And what I mean by that is not like water sewer plumbing, I'm talking about how finances and compliance is being streamlined. So from an owner and operator perspective, software is being judged on its ability to touch cash, codify compliance and ultimately create lender grade, data trails or data rails for that matter. And what that really means is the how am I ingesting information and how’s software ingesting information and how am I able to receive and view this information? And so the strongest platforms now live at the intersection of payments, receivables, vendor pay and financial reporting, and then they're integrated directly with the property accounting and banking platforms. This is why I think l purpose-built operating systems for owners, landlords, managers and community manager are really compounding.
 They lower data that's outstanding, increase online collection and reduce payment disputes and ultimately give the manager the ability to have audit-ready exports that travel cleanly from lenders to LP's and auditors to what have you. So what that means ultimately at a practical level I think is that products that ship with bank fee connectivity, general ledger mapping, and out-of-the-box integration into Yardi, Realpage, QuickBooks and Treasury systems are clearing procurement while you know while like these generic platforms and portals and disconnected pointed tools are stalling. So this kind of dovetails into another point, that you hear a lot in technology innovation is that adoption is low. The reality is adoption is not low. The reality is that the tech is completely disconnected and disjointed from the practicality of operations. And so again, the operating system that we are seeing and the KPIs that we are seeing are, “Does this increase my cash flow? Does this compress expenses? And does it help solve an immediate and long-standing need within my company?

Erin:
 Great. That makes sense. And how should we think about electrification and home energy in multifamily and office portfolios?

Ash:
 So electrification is probably the biggest trend, not just within proptech or real estate, it’s a national trend that we're seeing. Electrification has shifted from…typical electrification stuff we've always heard about was solar and hard tangible items that you would have to actually install, but electrification has shifted from hardware novelty to basically industrialized logistics. And what I mean by that is the winners are aggregating supply, financing and installation through a single commercial workflow and a single customer promise. I'll use residential as a good example. You're seeing companies, like a company called Span which creates electrical boxes. Historically the way you would see your energy spend is you'd receive a bill from your utility company at the end of the month. With these new companies that are coming out, first of all, they are already institutional grade companies because they have to be because they are in the what we call proptech adjacent sector. And assurance falls in that category, electricity and others. So not only are they institutional grade ready, but on top of that you are in real time able to see your energy consumption and you are able to make the necessary changes based on real time information that's being provided to you. And then it goes way beyond just like I have a dashboard in front of me that spits out data. Dashboards are honestly nice to have at this point. It's kind of like at this point, it's mandatory, not even nice. It's just mandatory. It goes far beyond that. So you have an electrical box that's connected via software that's connected to your home, that's able to tell you your energy usage in real time so you don't have to make guesses at the end of the month and pay a bill that you may or may not have been surprised with. So you're starting to see that play out, and that's in residential and you start to see things play out in commercial as well, especially in property operations. And property operations is actually even cleaner because the notion of electricity and decarb really kind of play off of one another. But in the US specifically, decarb for the sake of decarbonization unless your state or city mandates it, it is really tied directly to your cost compression or income appreciation. So what I mean by that is you're seeing category leaders pair these backup battery and flexible electricity panels with underwriting that moves customer acquisition for one-time sales to durable account relationships. And what I mean by that, it's very simple me as a manager, I need to know what the cost of electricity is going to be for my residents and/or my community.
 During the summer months, your electricity is going to spike. During the winter months, your electricity is going to spike, and you have spring and fall, that's kind of in between. If I'm able to see in real time how my community is ingesting electricity and I can make a real-time active decisions on how to compress expenses and/or appreciate the income for that community based on the community's electrical needs. So at a practical level energy platforms double click and close the loop on this in terms of proptech, but at a practical level, energy platforms that own the route to market, the financing rails and the lifetime service relationships are compressing customer payback periods and ultimately improving attachment rates across battery, solar, load control, you name it like creating grid support value streams that did not exist in prior cycles. Take any utility company. It is a one-to-one relationship. You use, you pay. Very simple. It has now shifted from now that I've access to all this information on how my how electricity is being used and alternative sources of energy. How can I mitigate costs to increase the financial performance of my community?

Erin:
 Hey, sounds great. And AI is everywhere. Where is it delivering reliable ROI for property managers today?

Ash:
 Yeah, so AI eliminates variance, and what I mean by that, the variability…first of all, AI for the sake of AI is over. For the past two years, we've heard that AI is going to be a job killer. That's proven not to be true. We're seeing managers use AI for God's sake…there was an IREM study that we released on AI and we're seeing managers use, at least the LLM models to help with the decision-making process and you're seeing at a local level, at a regional level, also at a national level or at a corporate level amongst managers. The reality of AI adoption in our industry is consolidating around use cases that reduce cost and schedule drift to improve underwriting precision and accelerate compliance in the industry.  You saw it in construction with computer vision and document integration. You're starting to see it in housing with leases, you're starting to see that with audits that are running. So AI for the sake of AI is absolutely over. Managers are becoming very knowledgeable on what's real and what's fake. And ultimately, we're starting to see AI systems that produce measurable reduction in rework, fewer change orders and faster cycle time from assessment to remediation of winning budgets for example. So you're starting to see that kind of play out in in our industry. And the key design partner is AI plus the profession. And what I mean by that is AI plus legal, AI plus management, AI plus insert practition, where the output is not a chat response, it is evidence that survives just an audit. The pattern yields sticky enterprise contracts creates repeatable procurement narratives and really supports defensible pricing for platforms that really ultimately continue to learn from portfolios at scale.

Erin:
 Okay, makes sense. And what contracting and vendor risk guardrails should we use as we adopt more fintech and AI tools?
 
 

Ash:
 Yeah. So I'd begin asking, if I'm a manager and a proptech company that says their AI is asking questions, I think the first thing I would ask is, “Do you do pilots?” And if they do not do pilots, I would absolutely not engage with that company. You also want to be able to understand the types of AI they're using and ultimately who controls that data. And so the big one ultimately is can I pilot the company? How long are the pilots? Anything over six months is a no-fly zone for managers. Three to six months is quite enough and before even doing anything, test across a small subset, maybe even just one community at first before and if it works well, scale across another community, and slowly integrate the technology that works. And that ultimately removes or eliminates burden from your on-site team to your regional teams to your asset management teams. So ultimately you're trying to slowly drive the car to 100 reverses going zero to 100 in 60 seconds, so avoid that at all costs. I've seen a lot of companies get burned that way and they mess up pretty badly. I would start very slow. Start with one community, scale from that one community.
 If it works well, great. If it doesn't work, then give the feedback to this proptech company that didn't work and we're not going to continue. And also if there are other competitors out there, you are able, you should and absolutely should run multiple pilots at the same time. So there's two competitors in market run the same pilot for both companies on the same community at the same time and see which one yields a better result for you.

Erin:
 Okay great. Thanks for joining us, Ash.

Ash:
 My pleasure. Thanks for having me.

 Erin:

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