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How AI can help real estate companies thrive in a competitive market

Written by Øyvind Skarelven | Oct 8, 2024 7:25:20 AM

Rising interest rates, price hikes, and regulatory changes are putting pressure on the profitability of real estate companies. A highly effective way to streamline operations is by optimizing the accounts payable (AP) process through AI-driven automated invoice processing, which enhances efficiency and accuracy in managing accounts payable.

In recent years, real estate has become a more complex and demanding industry. Stricter regulations, combined with rising costs, mean that real estate companies can no longer focus solely on property management and revenue. Increasingly, businesses must also monitor expenses closely to maintain profitability.

 

The need for advanced tools in real estate accounting

As real estate companies navigate these increasing pressures, the need for more advanced tools and processes becomes apparent. Traditional methods are no longer sufficient to manage the growing complexity, requiring businesses to seek innovative solutions that streamline operations and drive profitability.

This issue affects the entire organization but often lands in the accounting department, where outdated ERP systems create a double challenge: they aren’t designed for data collection or analysis, and they rely on manual workflows that are time-consuming and prone to errors. This leaves little capacity for strategic financial planning. AI-driven AP automation addresses these inefficiencies by streamlining invoice processing, improving accuracy, and freeing up time for more valuable tasks.

As companies embrace these innovations, automation and AI-driven tools are transforming finance departments across industries. Real estate is no exception. With the complexity of managing invoices and financial data increasing, businesses are turning to AI-powered solutions to streamline accounts payable (AP) processes and eliminate inefficiencies.

 

Automating Key AP Processes with AI

AI Accounts Payable solutions like SEMINE, have already helped companies like Heimstaden, Obos,  Daimyo, Alti Forvaltning, Anker STI and 10 000+ other companies optimize their AP operations. Let me take you through a few examples:

 

Streamlining real estate accounting with AI automation

Multi client view

When each property operates as a separate legal entity, managing accounting can become complex. With Semines AI solution for AP automation, accountants can efficiently handle multiple entities within a single interface. This eliminates the need to switch between systems, reducing errors, confusion, and delays that typically occur with manual processes.

READ MORE: A better, easier way to work with multiple clients

AI-driven automated invoice approval for real estate companies

A common bottleneck in organisations is the time required for routing and approving invoices. With SEMINE’s automated invoice management system, AI learns and suggests accurate account coding, sends invoices to the appropriate approvers, and posts them automatically once approved. Additionally, invoices meeting pre-set criteria can be processed without further approval, saving significant time.

Avoid late fees with AI-based accounts payable automation

It is worth noting that SEMINE uses machine learning in a way that ensures the system is not disrupted by changes in invoice formats or similar issues, making the solution more robust than so-called RPA-based solutions ("robots"). This helps businesses avoid collection fees and late payment penalties, while also maintaining good relationships with suppliers. It may even make it easier to take advantage of early payment discounts offered by some supplier.

READ MORE: AP Automation: Key terms you need to know

AI for accurate VAT management in real estate

Managing VAT can be intricate, especially in the real estate sector. SEMINE reads every single line item on an invoice and can automatically split the bookkeeping of even complex and extensive purchases to ensure that the VAT handling for each individual item is correct. In cases where invoices have incorrect VAT rates, SEMINE understands that previous patterns indicate the invoice is wrong and overrides the specified value.

Enhanced collaboration across departments

All of these elements make the workday easier and save time for those managing the accounts, but others in the organization can also benefit from the tool. SEMINE’s AP automation extends benefits across the organization, enabling subcontractors and external partners to perform tasks within the system securely. Role-based access ensures only authorized personnel can manage specific functions, promoting collaboration while maintaining control.

 

More data for strategic work

Consolidating all invoice data

Many modern finance departments are expected to contribute on a more strategic level, particularly in performing higher-level analytics. Fortunately, the same functionality that assists with VAT handling—by reading every single line item on an invoice—enables SEMINE to gather all the data from incoming invoices regarding company purchases. This data collection helps streamline operations across your accounts payable process.

Easy export for benchmarking, etc.

The collected data can be exported into your preferred analytics tool—whether it’s Power BI, Tableau, R Studio, or any other. This allows businesses to compare service providers across different properties, helping to drive prices down. Additionally, this data can be enriched with information from other sources, such as internal floor plans or external weather data, to benchmark energy bills and determine which properties are most energy-efficient per square meter.

READ MORE: This is how easily the focus can be shifted from punching to analysis

Flexible Solution

These are just a few of the issues SEMINE has recently helped real estate businesses tackle. Our experience has taught us that, while many challenges are common across companies, there are often significant differences in how each company prefers to solve them. We encourage businesses to contact us to discuss their specific accounting challenges—we’ve encountered a wide range of issues and can often provide valuable solutions!