For many real estate investment management firms, an increase in Assets Under Management (AUM) usually leads to an increase in headcount. Why is that – and what can be done about it?

I spoke recently with the head of asset management for a firm in San Francisco that manages five open-ended core plus and value-add, multifamily-focused funds. She admitted that years ago, the firm had followed a typical pattern in the industry: acquire a property, hire an analyst. As AUM grew, headcount grew proportionately.  Yes, there was portfolio growth, but the firm was becoming more inefficient from a headcount perspective.

And it’s no wonder – consider the costs associated with onboarding a new employee (in pricy San Francisco, no less). Salary, benefits, rent, and other overhead costs – all of this eats into the margin of the new deal that preceded and necessitated the new employee’s services. But this is traditionally how CRE firms have functioned.


Because a newly acquired property means more residents, an extra rent roll, an extra trial balance (maybe from a new third-party fee manager), a new loan, new investor requirements … and so forth. My client in San Francisco compared it to adding additional sandbags to help stop rising waters in a storm (in this case, a data storm). In her defense, the industry has never had a better option for solving these challenges than throwing bodies at it.

Well, until now, that is.

My client became a Pereview customer over the past two years and during that time Pereview has become a strategic member of her team. They have added 12 properties since implementing the Pereview platform but have only seen a 20 percent increase of staff. Their AUM is growing AND they have become more cost efficient.

What changed? “Pereview has automated our data collection,” she said. “It has automated our reporting and – more importantly ­– customized that reporting so that we can do our analysis our way, from automating annual business plans, to easily being able to report actuals to underwriting to budgets, and tracking trends like occupancy, DSCR, and other metrics over time, to forward-looking assumptions. That gives us confidence in our decision-making processes. We are answering ad-hoc questions faster than ever with Pereview’s embedded PowerBI reporting tool.”

Not only is the firm not adding staff at the rate they once were, but the firm’s most senior reporting lead was able to happily retire after a 20-year career without feeling he was leaving his team in the lurch.

We ended our fun conversation congratulating each other on what has been an extremely rewarding partnership between our two companies. I’m lobbying for Pereview to get the firm’s Employee of the Month award. Fingers crossed!