The recent successful launch of the BDO PropCost – an independent analysis of service charge expenditure data benchmarking report, has been very well received by all parties in the property industry who have been calling for more transparent data for many years. It also raises many questions around the collection, use and sharing of data in the industry.
BDOs PropCost Offices 2022 analyses service charge expenditure data for UK office buildings from 2019 through to the beginning of 2022 — a period of time in which UK office spaces have been subject to an unparalleled level of disruption and change due to the Covid-19 pandemic, Brexit and the subsequent economic uncertainty faced by many individuals and businesses. It provides meaningful insight into service charges and the factors that can influence building running costs.
As the property industry adapts to the realities of a digital world dominated by technology and, increasingly, artificial intelligence, so the amount of available data concerning real estate is increasing exponentially. This data concerns almost every aspect of the built environment: from how we use and interact with properties as individuals and businesses, through to how a building’s energy consumption and construction details are being recorded and analysed to help surveyors, asset managers, building managers, developers and investors make informed decisions about real estate.
The industry appears to be at a tipping point, with chartered surveyors and other property professionals having to use skills beyond the traditional surveying competencies. Data analysis is one such area that is growing in importance. It is no longer enough simply to possess data; the value lies in being able to use it.
There are many good examples of surveyors adapting their skills and approach to the new data-rich world. However, some are still protective over the use of their data and do not appreciate that by sharing it they will have access to a richer pool of data, which adds value to their advice to clients
BDO’s PropCost is a current example of how data can support industry challenges. The recent publication provides insights into the connections between building efficiency and the associated service charge costs. With the increasing requirements of the Minimum Energy Efficiency Standard (MEES) this will provide valuable contextual information that can be used in assessing the cost and impacts of improving the efficiency of a building.
Sharing data is still a major challenge for the industry. Changes are starting to happen, but it is far from universal. Confidentiality clauses act as an obstacle to wider data sharing as do ethical and compliance factors. There is the ever-present challenge of seeking consistent and trusted data.
Despite these challenges, PropCost has brought together a dataset across investors and landlords, with confidentiality of data being core to the analysis. As an independent accountant, the protection of sensitive commercial information was an absolute priority for BDO. As the dataset grows in future developments, the greater the analysis and insight can be without revealing information that could be traced back to a specific asset.
For those organisations that own property across several countries the issue of data standards is important. While the International Property Measurement Standards (IPMS) help to standardise measurement of assets there are still data fields that do not have a global standard.
Generally the quota of data that we experience nowadays can be a challenge. Identifying and establishing what will add value and insight will continue to be shaped and developed and while some organisations are still storing data in case it may be useful, they are often unsure what they are going to do with it. Moving from spreadsheet to database is a challenge facing many organisations. Some people find the data landscape a maze and are unsure where to start. This comes down to knowing what decisions need to be made, what reports need to be generated and therefore what data is needed.
BDO’s PropCost is a clear example of recognising and maximising the value of data to benefit the industry, aiding decision making and supporting those working within it. Their plans for development of the approach build on sector views and will allow an ease of access and a flexibility of insight which will bring value to all, but this does depend on data being shared.
If as so many say, the future of real estate will be data led there is much to do as an industry.
For more information about BDOs PropCost, please visit bdo.co.uk or contact Andrea Hunt, Head of Service Charge at BDO.
Andrea Hunt, Head of Service Charge Accounting, BDO
Kathryn Archer, PropCost Lead, BDO
Paul Bagust, Head of Property Standards, RICS
