It’s important for the property industry to be able to bring together diverse data streams in a readily comprehensible way. EG uses big data analytics together with its own proprietary risk management platform, PRISMS®, to support its investment decision making.

Traditionally, real estate markets have been slow-moving, and managing risk involved a huge amount of tedious work hunting down data and information. With the increasing use of technology and with more data available in the public, the real estate sector has quietly transformed into a faster-moving and scalable business.

The speed with which data of all types is now available is changing the nature of investor and manager relationships. Technology is improving our collaboration and helping identify risk so that it can be better managed to improve returns – we are having more conversations, more often both with investors and consultants.

Our data has become voluminous, but it is also fragmented. Bringing together each raw data source to derive insights is highly manual, takes time, and investment advisers are required to make painstakingly manual updates for each investment.

One could be forgiven for arguing that we now have too much of a good thing or that the scales have tipped from one extreme to the other. There is a risk that this data could overwhelm the industry and investors alike, clouding or even paralysing decision making.

But if you’re truly paying attention, you’ll understand that excess is not the key issue at hand. Too much data is not the problem – too much irrelevant data is. This is especially true of backward-looking and out of date data that is fast losing its value in the changing real estate world.

It is this dilemma that has led EG to invest further in our proprietary software PRISMS®, using 20,000 data series to identify and measure over 50 risks in real estate technology. PRISMS takes the focus away from an asset’s headline return and directs it to the asset’s risk and return ratio. We can assess numerous acquisitions in different locations, across sectors and ensure that our investors’ money is directed to investments with superior returns relative to its risk.

In addition to this asset-by-asset risk-management appraisal, quarterly risk-assessments on PRISMS have forced us to predict and quantify the impact that global, black swan events, among a range of other factors, could have on the market. As an entire staff team, we regularly gather to debate and ask, “what is the risk of international conflict, financial crises, and/or pandemic?” It just so happened that in 2020, the value of systematically asking that question became evident.

At the end of the day, the ability to provide clean, consistent data in a readily accessible and understandable format has never been greater. The ability to visualise correlations and fuse broad industry and macroeconomic trends with specifics down to the individual property level has become a key deliverable for the EG team. The power to easily access the right data in the right place – to search, to customise and to visualise this information in a dashboard – is an opportunity for two ideas to collide and spark a pattern that informs our investment approach.

Visualising relevant data in a customised way will make the difference in extracting insights and making data-driven decisions.