In today’s real estate industry, data is more than just numbers—it's the backbone of strategic decision-making, asset optimization, and efficient investment management.
Picture this: a leading real estate firm spent over three years trying to integrate disparate data systems, only to face cost overruns and missed insights due to unreliable data. According to "Technology and the Future of Real Estate Investment Management" from University of Oxford, over 60% of real estate businesses struggle with integrating multiple data sources effectively, leading to inefficiencies and missed opportunities.¹ This highlights the real challenge: making data work for you requires more than just collecting it; it’s about integrating diverse data sources into one cohesive system, something that’s easier said than done.
Many companies feel the allure of building their own Business Intelligence (BI) solution. On the surface, it seems like the perfect way to tailor a solution to their unique needs without paying for a third-party provider. However, the reality of DIY data integration comes with a series of challenges that can turn what seems cost-effective into a costly, time-consuming endeavor.
The idea of creating a BI solution in-house often starts with good intentions: having complete control and customization while aiming for potentially lower costs. You get to decide which systems to connect and how the data is structured, tailoring it to your specific needs.
With an in-house solution, you have full control over how your data is managed. You can customize your dashboards to suit your team’s exact preferences, create proprietary metrics, and decide what data sources are connected. This can be particularly appealing for real estate businesses where every portfolio is unique and there’s no one-size-fits-all approach to performance metrics.
Building internally often appears cost-effective at first glance. Many companies assume that by leveraging their own team, they can avoid ongoing software subscription costs. The ability to develop solutions incrementally, adapting as new requirements emerge, also seems like an efficient allocation of resources. However, the actual cost over time—both in terms of development effort and ongoing maintenance—often paints a different picture. For instance, a mid-sized real estate company attempted to build an in-house BI solution to avoid software fees, but soon found themselves overwhelmed by unexpected costs. As the project evolved, they needed to hire additional specialists and dedicate significant resources to troubleshooting and updates. What seemed like a budget-friendly option initially ended up costing them more than double their original estimate, with many hidden expenses emerging along the way.
Most businesses underestimate just how challenging it is to integrate multiple data sources effectively. For example, a midsize real estate firm attempted to build their own integration between their property management system and accounting software. They quickly found that each system used different data formats, leading to discrepancies that required constant manual reconciliation. The project, originally intended to take three months, ended up taking over a year, with ongoing maintenance requirements and unexpected costs—resulting in a 50% increase in project time and a budget overrun of nearly 70%. This kind of underestimation is all too common, leading to delays, frustration, and a lack of trust in the data.
In the real estate industry, data comes from multiple sources—ranging from internal property management systems, tenant data, lease records, to market analysis reports. Each of these sources uses different formats, and attempting to integrate them manually is a painstaking process that requires deep knowledge of data structure and normalization. For example, inconsistent data formats can result in errors such as double-counting rental income or missing crucial lease expiration dates, leading to unreliable financial reports and poor strategic decisions. Failing to achieve consistency between these formats can lead to erroneous insights, affecting strategic decision-making.
Data integration isn’t a one-off task. Frequent software updates across different systems—such as accounting and property management tools—often lead to repeated disruptions. Each time a system is updated, integrations can break, requiring manual fixes and reconfiguration. This causes downtime, delays in reporting, and increased risk of errors, putting additional pressure on IT teams and affecting overall efficiency. Without dedicated resources, maintaining consistency becomes nearly impossible, which in turn affects data quality and trust.
The initial setup of a BI solution might seem manageable, but ongoing maintenance costs can be significant, often leading to unforeseen expenses. For example, according to Barbee Davis and the 60/60 rule, maintenance can account for up to 60% of the total cost of ownership.2 Without a specific budget allocation and expertise, maintenance can quickly become a heavy burden, with hidden costs accumulating over time.
Maintaining a BI system demands a wide range of expertise—data engineers responsible for data integrity, database administrators ensuring optimal performance, integration specialists managing the connections between various systems, and often niche knowledge related to real estate metrics and reporting. The need for these diverse skills makes the solution highly dependent on key personnel, creating bottlenecks and single points of failure when these specialized employees are unavailable or leave the company.
Beyond salaries for skilled personnel, DIY integration also has hidden costs such as downtime, loss of productivity due to manual data corrections, and the opportunity cost of not having your team focus on core business activities. These costs accumulate over time, often exceeding the costs associated with professional platforms.
As your real estate portfolio grows, so does your data. A DIY solution often faces scalability challenges, such as inadequate architecture that can struggle to handle increasing data volume. For example, as data grows, query speed can become significantly slower, affecting the responsiveness of your reports and insights. Additionally, as more users access the system, limitations in user accessibility can create bottlenecks, leading to downtime and reduced productivity.
For example, a mid-sized investment management firm attempted to scale their in-house BI solution as their portfolio grew rapidly. Initially, the system worked well for a smaller data volume, but as their portfolio expanded, they experienced significant slowdowns in reporting, increased system crashes, and disruptions during peak usage scenarios, such as end-of-quarter reporting or investor presentations. Ultimately, they were forced to rebuild the entire infrastructure at considerable expense, causing months of operational delays and impacting their overall growth strategy.
Without a robust, scalable infrastructure, these issues can severely hinder business operations during crucial growth phases.
Most DIY solutions are built to meet current needs, without considering how data requirements will evolve. Aligning with market trends, regulatory changes, and emerging technologies requires a scalable and adaptable data infrastructure. Without the proper foundation, keeping up with industry changes becomes extremely difficult, and any competitive advantage is quickly lost.
DIY solutions often focus on the basics—collecting and visualizing data. For example, features like predictive maintenance insights, which can forecast when building systems are likely to need repairs, and automated anomaly detection in financial data, which helps identify irregularities before they escalate, are often missing in DIY solutions. These advanced capabilities help real estate owners stay ahead of potential issues, reducing unexpected costs and improving asset management efficiency.
Today’s data needs go beyond simple descriptive analytics; real estate owners and managers want predictive insights—foreseeing cash flow problems, predicting tenant behavior, or anticipating market shifts. Building predictive models requires a sophisticated infrastructure and data science capabilities, which can be resource-heavy for an internal team.
Real estate reporting requires not just access to data, but also presenting it in the right format, to the right people, at the right time. Automated reporting capabilities that ensure seamless communication between asset managers, investors, and executives are critical. A DIY solution often lacks the flexibility to automate reports or tailor them as requirements change.
When you opt for a BI-platform designed specifically for real estate, many of the complexities and risks associated with building your own system are completely eliminated. Here’s how a specialized platform takes the burden off your shoulders:
Building your own data integration system often leads to endless headaches—dealing with disparate systems, reconciling inconsistent data formats, and troubleshooting integration errors. With a real estate-focused platform, all your data sources are automatically synced and consolidated. There's no need to manually connect systems or clean up data, freeing you from the time-consuming and error-prone integration work.
A DIY solution requires constant attention—maintenance, troubleshooting, and updates are all on your plate. Every software update, system change, or new integration brings its own set of challenges. A real estate platform takes care of all of this for you. Updates and patches are managed by the platform provider, so your team can focus on what matters without worrying about the technical upkeep.
Building your own solution often requires a team of highly specialized IT professionals—data engineers, database administrators, integration specialists, and more. These roles are not only costly but hard to retain. With a platform, you don’t need to hire or manage a specialized team. The platform’s infrastructure is designed to work out of the box, and support is just a call away when you need it.
As your real estate portfolio expands, so do your data needs. DIY solutions often struggle to scale without major system overhauls or additional development. A domain-specific platform is built to grow with you. Whether you’re adding new properties or expanding into new markets, the platform adapts seamlessly without the need for costly and time-consuming upgrades.
In-house solutions often run the risk of falling short when it comes to staying on top of industry regulations and compliance standards. With a specialized platform, you can rest assured that all regulatory requirements—whether they’re tax laws, accounting standards, or data protection regulations—are built into the system. The platform is continuously updated to meet changing legal and regulatory landscapes, so you don’t have to worry about staying compliant.
With a domain-specific platform handling all the complex data management and integration work, your team can focus on higher-value activities like strategic asset management, financial planning, and tenant engagement. The platform automates the tedious technical work, allowing your team to shift their focus to growing the business and enhancing operational efficiency.
While the idea of building a BI solution in-house can be appealing, the challenges that come with it often outweigh the benefits. By choosing a partner like Align, you ensure that your data integration is seamless, scalable, and future-proof. Let us take care of the complexities, so you can focus on driving your business forward.
Align transforms the way real estate businesses manage their data, reducing operational burden and turning data into a strategic asset. Whether you're an investment manager, a family office, or an institutional investor, Align is the smarter choice to ensure your data infrastructure is ready for today’s needs and tomorrow’s challenges.
¹ Oxford University. "Technology and the Future of Real Estate Investment Management". Available at: https://www.sbs.ox.ac.uk/sites/default/files/2020-12/Technology%20and%20the%20Future%20of%20Real%20Estate%20Investment%20Management_0.pdf
² Barbee Davis. "97 Things Every Project Manager Should Know". Available at: https://www.oreilly.com/library/view/97-things-every/9780596805425/ch34.html
