Skip to content-main content

Blog

Case Study: Disciplined, tech-enabled innovation allows Allegiancy to predict the future

Blog

Case Study: Disciplined, tech-enabled innovation allows Allegiancy to predict the future

By: Steve Sadler, CEO, Allegiancy

November 12, 2015

It’s true. Disciplined, tech-enabled innovation can allow companies to predict the future. Here’s how, as detailed in our latest case study.

Context: How Allegiancy has created a crystal ball by harnessing the power of analytics to establish new relationships in data to create lasting asset value.

Problem: Harmonizing and accessing millions of bits of data captured from across Allegiancy’s nationwide portfolio by a broad tech-enabled platform and incorporating it into a systemized approach to establish efficiencies.

Solution: Off-the-shelf software and systems, re-imagined, integrated and deployed in innovative ways to unearth and understand new data to create a systemized platform that proactively initiates new efficiencies.

The Background: Big data is transforming industries through pioneering analytics that helps managers measure captured information to help them more efficiently and profitably manage their company. Most people assume ‘big data’ is used almost everywhere, but that’s not even close to reality.

The commercial real estate industry has been slow to embrace big data. It’s still largely an industry that’s run on a 1950s model that centers around vertical integration and apprenticeship, where the database is made up of sticky notes and the decision engine is a yellow pad. You know, the “this is the way we’ve always done it” model.

In pioneering a new method of active asset management for commercial real estate, Allegiancy analysts and executives harness the power of algorithms and analytics to discover new relationships in operational data that allow us to create lasting asset value.

Allegiancy has created a culture of action through data-driven discipline. What does that mean in execution? Allegiancy leverages technology to understand relationships in the data sets, allowing us to predict what will happen next with surprising accuracy. This forward leaning approach is fueling efficiencies that are propelling the company to the forefront of the industry.

Allegiancy President Chris Sadler describes it simply as “mining a little deeper to discover gold for our clients. Most data is never even looked at by our competitors, much less studied, analyzed and acted upon.” Essentially, new insights lead to big opportunities.

The big data at Allegiancy might be a million pieces of data or more, said Taylor Turner, an analyst with the firm. “So what we do is go into the data, leveraging our decades of experience, and uncover relationships – both causal and correlated – that inform our decision making and allow us to take action.” he said.

In analyzing the data, Turner and the Allegiancy team find relationships and uncover anomalies and then push those discoveries to managers in the firm who can act quickly on the information to create improved efficiencies. It’s taking every data point in every building in the Allegiancy portfolio — whether that’s monitoring HVAC systems, capturing temperature control statistics, tracking tax payments or myriad other reams of data — and figuring out how it can be used to improve efficiencies and increase profitability.

Turner loves the work. “Sometimes,” he said, “I do some of this stuff in my spare time because it’s so fun.”

And it moves the needle in terms of results for clients and the assets Allegiancy manages.

The goal is to leverage the information to make more money for the investors in Allegiancy, according to Ron Mentus, SVP Quantitative Analytics. Other asset managers, almost certainly, are not even tracking 90 percent of the data. “The information may be there, may even be readily accessible, but virtually none of our competitors is using ground level intel and leveraging it for the benefit of owners,” he said. “Unfortunately, that is costing property owners and investors millions upon millions of dollars every year.”

The automated algorithms are continually scanning the data looking for anomalies. What are the sources of the anomalies? What are the solutions? What further problems do these anomalies create or trigger? These are among the questions the analysts and managers are looking to answer whenever the system elevates an issue. Whether it’s workflow issues, vendor billing and payments, or power usage, Allegiancy analysts are continually crunching data and looking for new relationships in the data.

“The fact that we can get into the granular data level to see where things are being held up and why gives us an edge in the industry,” Turner said. “I like making things more efficient. If we can get it from A to B 50 percent faster than everybody else, there is an arbitrage opportunity. Ultimately it gets to the bottom line.” That is how Allegiancy trimmed information lag times from 30 to 45 days under the status quo to 24 hours or less.

That in turn translates to better returns for investors and property owners. Turner describes a galvanized corporate philosophy: Allegiancy is responsible for being stewards of someone else’s money.

“They’re scarce resources we’re entrusted to be stewards of,” Turner said. “That’s the goal with the efficiency: To be the best steward of the assets we’re entrusted with.”

A key aspect of the Allegiancy system is predictive analytics. It’s gathering the big data to foresee where problems may occur. For example, perhaps replacing a compressor today will avert a costly breakdown in the HVAC system several months down the road.

“We’re looking for things we can take care of five months ahead of time, fix the problem before it happens, make the repair while the damage is small and take care of the asset,” Mentus said.

“We’re finding relationships through analytics,” Sadler said. “And insights through understanding of how disparate data relate to one another. Knowledge, in the right hands, is very powerful indeed.”

Read all of Allegiancy’s case studies and success stories here.

The foregoing does not constitute an offer to sell or a solicitation of an offer to buy securities, and no money or other consideration is being solicited hereby, nor will be accepted. An offer to purchase or a solicitation of an offer to buy the securities can only be made or received and accepted once an offering statement is qualified by the Securities and Exchange Commission as exempt from the registration requirements of the Securities Act of 1933 (the “Act”), as amended, pursuant to Section 3(b)(2) of the Act. Any such offer to purchase securities may be withdrawn or revoked, without obligation or commitment of any kind, at any time before notice of its acceptance given after the qualification date of the offering related thereto, and any indication of interest to purchase securities involves no obligation or commitment of any kind.

Recent Blog Posts:

Blog

iGlobal Forum to Host 4th Real Estate Crowdfunding Summit

iGlobal Forum is pleased to present the 4th Real Estate Crowdfunding Summit, taking place in Los Angeles on Thursday, June 23. Allegiancy CEO Steve Sadler is among the speakers, featured on a

READ MORE

Blog

Why George Washington and Henry Ford would have loved crowdfunding

George Washington is known as America’s `First Entrepreneur’ and I am fully confident he would have been a huge proponent of crowdfunding and the new Reg A+ rules — also

READ MORE