How an Originator Compiles High-Accuracy Appraisals with Intelligence
Meet Elliot Smith
Elliot Smith is Managing Partner at Flatbay Capital, a Texas-based direct commercial real estate lending firm specializing in originating $1M+ notes for industrial properties in several states.
Unlike traditional commercial real estate lenders, Flatbay Capital’s primary clientele are owner-occupied real estate users: businesses currently facing challenges acquiring bank loans but with promising upside. Mr. Smith’s firm receives a significant portion of its deals through a vast referral network of bankers and lenders, and relies on accurate, well-organized data to select its projects.
Painting the Scene
Previously, Flatbay Capital faced challenges in accurately underwriting and validating loans for commercial properties, with due diligence processes lengthening and underwriting becoming increasingly complicated. Many of their clients also had outdated perceptions of their property values, often based on old appraisals or market assumptions that did not reflect current conditions. This obsolete information led to inefficiencies in underwriting, consuming valuable time and resources.
The Crexi Intelligence team reached out to Flatbay Capital in October 2023 and demonstrated the platform’s capabilities, namely how it aggregated real-time market metrics and a vast, organized collection of sales comparables nationwide. After Flatbay Capital integrated the tool into its workflow, Crexi Intelligence became an essential part of their day-to-day work, primarily used for underwriting and validating current loan opportunities.
“We often deal with outdated appraisals, and Crexi helps us get updated, accurate data. This is crucial for a lender to create an estimated value prior to an official appraisal. Dedicate time to learning it, and it’s worth it.”
Using Crexi Intelligence, Flatbay Capital significantly reduces the time spent on initial property assessments. Conducting thorough preliminary checks before committing to full appraisals saves the company both time and resources. At the same time, Crexi’s up-to-date information provided by Intelligence ensures that Flatbay Capital’s decisions are based on the latest market data, preventing reliance on outdated appraisals.
The tool’s capabilities extend beyond underwriting. Flatbay Capital plans to leverage Crexi Intelligence for targeted marketing efforts, identifying properties based on specific criteria and even pulling deeds of trust to understand loan maturities and competitors’ statuses.
Results
In less than ten months with Intelligence, Elliot Smith and his team have enjoyed access to:
- Property Valuation: Crexi Intelligence helps Flatbay Capital verify property values. In one scenario, a quick comps search in the local area revealed a $2 million value for a property the owner thought was worth $3.5 million, preventing overvaluation.
- Efficiency in Underwriting: The platform’s up-to-date and accurate data streamlines the underwriting process. One deal involved a warehouse/manufacturing facility where Intelligence was crucial in identifying an appraisal that came in 30% higher than the buyer’s expectation.
- Custom Reports: Flatbay Capital’s analyst utilizes Crexi Intelligence to pull up addresses, generate comps lists, and export reports. These are shared with clients to set expectations and show market trends, building trust through transparency.
“Crexi Intelligence is a very robust software tool […] if you want to be efficient with your time and access the most recent market information, this is a great resource.”
Make better-informed decisions: get a demo of Crexi Intelligence today.
