Benchmarking software reveals tenant risk to office landlords

Income Analytics, based in London and advised by Oxford Saïd Business School, has launched a set of income indices and benchmarks to help landlords and investors quantify real estate risk.

The data is based on information from more than 355m global companies provided by business decision data and analytics company Dun & Bradstreet.

Income Analytics allows the real estate industry to access, analyse and deploy company credit data on tenants, real estate assets and investment portfolios.

Investors and lenders can receive real time analysis of underlying tenants’ creditworthiness and according to Income Analytics, confidently assess future performance and ultimately likelihood of default.

Matthew Richardson, co-founder and CEO of Income Analytics said: “At Income Analytics, we have created a truly unique and much needed set of tools and analytics for the global commercial real estate industry. No industry specific product for investors and lenders to assess and monitor the changing quality of their tenant income over time currently exists.

“More worrying is that very little has changed since the sub-prime crisis of 2008 and the recent global crisis caused by coronavirus makes the need to access accurate and current income data more important than ever before. Our aim is to provide the real estate industry with a critical tool in which to assist investment decisions and investor reporting.”

Income Analytics’ example of a portfolio management dashboard

The platform is based on the premise of Income Analytics’ adviser Andrew Baum, professor of practice at Said Business School, University of Oxford, who said that: “The value of real estate investment is ultimately determined by the level, duration and quality of the rental income paid by your tenants.”

Income Analytics’ reports and dashboards include its own analytical tools and scoring systems alongside credit report data including a 10-year tenant income risk forecast, global tenant scores, bond equivalent ratings, and global corporate family tree.

Tools include tenant credit reports, made up of identification checks, quality of covenant and probability of default along with the usual company financials, and asset level credit reports with aggregated income stream analysis and assessment of probability of loss.

There is also portfolio income manager software which allows users to view and monitor the financial health of existing tenants and portfolio income quality 24/7.

Income Analytics is led by a team including former executives from Quintain and Fidelity International. Professor Andrew Baum of the Oxford Saïd Business School is an adviser.