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Fintech for Commercial Real Estate? Here’s 12 Reasons Why

  • 6 min read

Collecting receivables can be challenging for commercial real estate firms. Here are 12 reasons why CREs are automating their invoice to cash processes (and why you should too!).

According to KPMG, this year in Q1 2017 global investment in Fintech companies hit $3.2 billion across 260 deals… and this is just the beginning. The way the internet changed publishing and music, Fintech is now changing industries like commercial real-estate (CRE) by modernizing the old-school processes used by finance.

It’s no secret that collecting receivables for CRE companies is a challenge and managing multiple tenants can be frustrating. Without an effective platform to communicate rent charges, CAM fees, and tax across multiple locations and divisions, cash flow can be stifled with no real insight.

Fintech is the answer for today’s CFOs and Property Accountants who need innovative technology to meet the digital appetite of customers, improve their experience, streamline processes, and access real-time data to make real-time decisions. A financial technology gaining traction with CRE companies is tenant platforms powered by accounts receivable (A/R) automation. With the ability to manage all tenant rental charges, payments and collections in a cloud-based platform, AR automation eliminates manual processes to save time (reconciling payments, reissuing invoices, chasing down tenants’ sales numbers) and refocuses efforts on high-value activities like tenant experience.

Take Brixmor Property Group for example. They needed to improve communication with their tenants but with over 500+ shopping centers across the United States, this was a challenge.

“We were looking for a platform that would enhance communications with our customers as well as provide more payment options for our tenants. Given the scale of our company, we also wanted to simplify how we receive and reconcile payments from our tenants and found [AR Automation] was a good fit for our needs” - Dennis Hanifan, VP of Application Systems, Brixmor Property Group

So, why was AR automation a good fit for Brixmor’s and other CRE companies?

Here are 12 reasons why they automated their invoice to cash and why you will too:

1. CRE companies want to say goodbye to paper

Fully automated electronic delivery for charges like rent and CAM fees eliminates the need to mail paper (cuts postage and print costs) or attach PDFs. E-invoices are sent from the platform to the tenant’s email address with a link to enter the portal. This allows them to view their account details, open AR balances and make payments.

2. CRE companies are tired of the excuse, “I did not receive it”

With an AR automation platform, you’ll know exactly when an invoice is delivered. Unlike mail or PDFs, with electronic invoice delivery, the status of the invoice is tracked: invoice is not delivered, delivered, opened and viewed. This provides certainty that an invoice has been received and the tenant has engaged with it. It also eliminates the need to resend invoices - they are available 24/7 in the online tenant portal.

3. CRE companies experience friction with tenants

Lack of communication between tenants and your AR, collections or property management team can create frustration. With an online AR platform, you can collaborate with tenants in real-time on invoices, payments, and disputes with a full audit trail. This transparent relationship fosters a better way to support tenants and improve their experience.

4. CRE companies’ collections process is sluggish

A manual collections process typically involves pulling a report of outstanding accounts from your ERP (Yardi, MRI, JD Edwards), organizing them into aging buckets and assigning to collectors or property managers. By the time you’re finished, information is already out of date. With an AR platform, your team has access to a real-time dashboard with top outstanding accounts, aging balances and the ability to tag problem accounts to collectors. In addition, it eliminates the need for payment reminder calls or emails. The system automatically generates reminders that are sent to your tenants, with visibility into when they received and viewed it. These friendly reminders reduce the number of problem accounts and provide actionable insight for your collection team.

5. CRE companies are tired of manually matching payments

Reconciling payments from tenants can make your AR team feel like detectives. They take lump sum payments and investigate how they should be applied to multiple open charges. Talk about an unnecessary amount of guesswork! With an AR platform, tenants select charges at a line-item level so all payments are matched at the checkout - no more need for lengthy investigations. Once a tenant makes a payment, it is automatically reconciled to your ERP.

6. CRE companies are left in the dark about their tenants

With manual reporting and information in various systems, many CRE companies are operating with subpar tenant data. With an AR platform, you will have a set of real-time analytics and reports based on both broad and deep sets of tenant data. This provides actionable insight for your team.

7. CRE companies need to move tenants online

Moving tenants and receivables online, significantly reduces costs, but there is one doubt that creeps to mind - will my tenants use it? This isn’t a worry with AR automation providers like VersaPay who offer an e-adoption program to help onboard tenants. This includes invoice inserts, email campaigns, and data validation to remind tenants how easy it is to manage their account online. VersaPay also speeds adoption through their “Express User” feature, that allows tenants to access their account easily with no username or password - goodbye adoption barrier.

8. CRE companies need control over credit card acceptance

When CREs accept credit cards, the fees can be expensive. But, tenants are demanding to pay by credit card to extend payment terms. With an online AR platform, you can control which tenants can pay by credit card, set terms and credit limits for card acceptance and offer autopay. A key feature of AR platforms, like VersaPay, is the ability to store credit card information for future use in a secure PCI Level 1 environment. Not only can you easily turn credit card acceptance on and off, but you can do it securely. If you’re thinking about accepting credit cards, but are apprehensive read this eBook: 5 Reasons for B2B Credit Card Acceptance.

9. CRE tenants demand more ways to pay

The tenant experience is important for any CRE and with various payment methods on the market, tenants’ demands are on the rise. Instead of paying by check, an online AR platform opens the door to flexible payment options including auto- pay and prepay with ACH/EFT and credit card. It provides self-service for your team and tenants who both have the ability to schedule payments to settle accounts faster.

10. CRE companies need fast and easy bank reconciliation

CRE companies manage multiple bank accounts, which can make bank reconciliation difficult. With a tenant portal from VersaPay, when payment is made through the portal, this is settled direct-to-bank in multiple accounts with no co-mingling or 3rd party processing, making bank reconciliation fast and easy.

11. CRE companies need to improve their ERP but no resources or time

ERPs manage multiple functions of a CRE business but they tend to be the jack of all trades. To combat this, companies look to build on their ERP to fill in gaps (e.g. the need for better AR management). But, with multiple projects on the go, IT time is limited. With AR automation platforms hosted in the cloud, they can seamlessly integrate with your ERP. Set up typically takes 6-8 weeks with limited IT resources. It’s a win-win: your ERP and AR automation platform are better together and your IT can focus on projects that keep them up at night. If you’re not sure your ERP gaps, take a look at this blog post: 4 Reasons Why your ERP Alone is Not Enough to Optimize your Invoice-To-Cash Cycle.

12. CRE companies need a better way to gather tenant revenue numbers

Tenant reporting requirements may be necessary but gathering data from tenants is a nightmare. Property management teams waste countless hours to fetch monthly and gross annual revenue numbers from tenants. On the other end, tenants' frustration increases because they cannot get in touch with your team. With an AR platform focused on CREs, your tenants can enter their reporting numbers for the period within the portal, allowing your team to gain full visibility into tenant performance. This makes it easier for your tenants to do business with you and provides a clear audit trail on this reporting info that you need.


So, are you convinced you need to put AR automation and a tenant portal on your roadmap? Time, money, insight and a great tenant experience are all key for CRE companies and Fintech can help. Learn more about commercial real estate and Versapay here.

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