‘AI Changed Everything’: How A Multifamily Analytics Company Is Using Artificial Intelligence To Improve Proptech Data Reliability

Data is the lifeblood of commercial real estate, but can CRE professionals trust that their data is timely, accurate and safe from running afoul of antitrust laws?

Marc Rutzen, co-founder and CEO of multifamily analytics company HelloData, said his firm’s approach to data puts clients’ minds at ease about quality while increasing transparency and accountability. 

HelloData uses artificial intelligence and machine learning to automate rent surveys, generate market-driven pricing recommendations and benchmark operating expenses.

“We have designed our models to be transparent using explainable AI,” Rutzen said. “Believe it or not, transparency is actually more important than accuracy, both in building trust with users and in avoiding the antitrust issues we're seeing in the multifamily industry altogether. Transparency holds you accountable for the results from the start.”

Bisnow asked Rutzen to explain how HelloData’s approach to data collection is different from others and how it benefits multifamily clients.

Bisnow: How can AI and machine learning help multifamily professionals?

Rutzen: Let’s start with rent surveys: The current process is inefficient, and several hours are spent each week collecting data, making calls and looking at various data sources. Then, more time is spent putting all that data together and analyzing it to help set rents. 

We use AI to streamline that process. A user simply logs in and types in an address, and we instantly identify their most relevant comps, survey each of their rents down to the unit level and then recommend rents based on that data.

Outside of saving our customers time, our goal is to make recurring processes like rent surveys more accurate and less speculative, relying on daily updates and detailed data to inform pricing decisions. ​​Many data providers only update their data on a monthly basis, but that isn’t frequent enough to set rents every day. One of our biggest competitive advantages is that we update the data on our platform daily, so we always capture the most up-to-date rents and concessions.

Bisnow: How does HelloData’s approach help CRE professionals?

Rutzen: With current systems, you would never know if a competitor’s unit with a particular floor plan hit the market and was leased in two days unless you were manually looking at their property website each day. No one has time to visit every one of their comps property websites every day, so we do it for them.

By tracking every day, we catch every unit that comes online and show the full price history and all the details about that unit on our platform. That level of granularity and frequency of updates helps our users price their units more effectively.

Bisnow: That’s interesting. Can you tell us about a multifamily owner or operator that benefited from HelloData’s model?

Rutzen: A very large multifamily owner in the NMHC Top 50 told us it took their asset managers about five hours to complete their weekly rent surveys. Using HelloData, the same work is done in an hour. 

Another client was putting together an investment package for a deal in a rapidly changing market and found their rent roll data wasn’t updated frequently enough to underwrite the deal. Our platform allowed them to track in real time how leasing was performing, not just on the asset they were valuing but also on the comps.

Bisnow: The practices of some proptech companies have raised antitrust concerns. How is HelloData different?

Rutzen: Our data is sourced entirely from publicly available sources. This is a key differentiator from legacy providers who require users to contribute their private data to use their revenue management systems. Our algorithms leverage data from over 25 million apartments each day, and our data pipeline is continuously growing.

Many of our customers are concerned about the potential repercussions of the antitrust lawsuits related to traditional revenue management solutions and are proactively looking for alternatives. By using only public data, we avoid those issues altogether.

Something else that sets us apart is that we do not subscribe to a black-box algorithm approach. The real estate industry has become used to black-box pricing models in multifamily, but some of the allegations from recent antitrust suits are that these models might be keeping prices artificially high by leveraging private data from owners’ property management systems to constrain supply. With a black-box model, how can owners even tell if their data is being used to set pricing in an anti-competitive way?

Bisnow: Prior to HelloData, how were you involved in the nexus between technology and commercial real estate? 

Rutzen: I’ve been in the proptech space since 2016 when I launched a machine learning company called Enodo, which was acquired by Walker & Dunlop in 2019. As part of the acquisition, I worked there for four years, was promoted to chief product officer and oversaw their product, data science and customer success teams.

Our concept for HelloData is similar in some ways to Enodo, but technology has changed so much in the last few years that our execution is entirely different. Things like leveraging computer vision to grade the quality of units from listing photos and using large language models to extract the value of concessions were not possible to do at scale five years ago. Recent advancements in AI have changed everything in proptech.

Bisnow: The current CRE environment remains challenging. How does that influence how industry players view technology adoption?

Rutzen: With today’s interest rate environment, far fewer deals pencil. That means real estate investors are looking at significantly more deals to find one that works. 

Because of this, being able to evaluate deals more efficiently is a necessity, and technology is playing a huge role.

I will say proptech companies have failed CRE in a lot of ways in the past, and there is now a healthy and reasonable skepticism toward real estate tech startups: Can they really do what they say they’re going to do? Will the company go out of business soon after it’s been onboarded and adopted? Will they continue to iterate, or stagnate?

I’ve been fortunate enough to be on both sides, first as a real estate professional analyzing deals, then as a proptech founder serving people like me, then as an executive evaluating other proptech solutions, and then again as a second-time founder building an AI-driven market analysis platform. 

There is both a hesitancy to adopt new solutions because of subpar results in the past and a recognition that businesses need to push the envelope to stay competitive. This environment and the lack of deal flow brings those elements even more into focus.

Bisnow: You’ve said you “bootstrapped” HelloData. What do you mean by that, and what does it mean for clients?

Rutzen: Most proptech companies raise a ton of money while figuring out their business. As a second-time founder, I learned a lot from my last company and decided to focus on the product and customers first and automate everything else as much as possible.

When we launched, we were self-funded, and now we have over 1,100 active monthly users. We have product-market fit, we’re profitable and we have strong revenue growth to continue to expand our features and functionality.

For clients, the “bootstrapped” approach translates directly into receiving a product that was built for them without unnecessary features. Any feedback or requests they have are quickly and effectively integrated into the product development process. This close relationship ultimately enhances client satisfaction and product functionality.

By automating as much as possible and keeping our team lean, we can spend time on what truly matters: delivering value to our clients through innovative multifamily analytics solutions. This not only keeps our operations efficient but also passes on the benefits of cost-effectiveness and high-quality service to our clients.

This article was produced in collaboration between HelloData and Studio B. Bisnow news staff was not involved in the production of this content.

Studio B is Bisnow’s in-house content and design studio. To learn more about how Studio B can help your team, reach out to studio@bisnow.com.