Reading through the copious number of commercial leases and related documentation is a task besieged with time overruns and human errors. Even when mistakes are identified, navigating backward to fix them can be as tedious as the original task itself. As per a survey conducted by Bloomberg BNA, ‘human error’ is still the leading cause of accounting mistakes – 27.5% to be exact – amidst all the technological advancements. One of the recent cases of such errors that come to mind is of Citigroup transferring $900 million as erroneous payments on behalf of Revlon, all because of a clerical error.
Not everyone has to make costly mistakes like Citigroup to understand the importance of automation of processes and the reduction of human interference to a minimum. With the adoption of AI and Machine Learning, a document-intensive process like lease abstraction can be automated entirely.
Apart from the obvious benefit of reducing the probability of human error, there are numerous benefits of automating the lease abstraction process:
1. Enhanced Flexibility
By implementing a lease abstraction software to automate the extraction of lease data such as contract start as well as end dates, lessee, lessor, break clause, designated use, and so on, accurate summaries of key information can be generated for a lease-related or any other real estate document. Furthermore, a customised summary template can be built by enabling the selection of data from 50+ data points, which can be populated automatically and generate a summary in a few clicks. A truly unique feature of our lease abstraction software is that it works in any language, any jurisdiction, and for any document.
2. Accuracy and Consistency
The usage of self-learning algorithms in a lease abstraction software ensures processes are quickly formulated and adapted by the AI. This learned knowledge is then applied consistently to every document while maintaining an exceedingly high degree of accuracy. It’s worth noting that lease abstraction solutions that do not require pre-training of the algorithms are much easier to use. Furthermore, as algorithms are continuously learning, more and more usage of the lease abstraction software will translate into improved accuracy.
3. Efficient Time Management
As AI automatically captures data points in a lease abstraction software, the time taken to extract critical data in a structured format from commercial leases and related documents is reduced to a minimum. Moreover, as data points are populated automatically as per the summary template, the step involving extraction of data is eliminated with only the data review step to be undertaken.
4. Widespread Application
With automation of lease abstraction through AI, the software acts as an immensely powerful tool to create a searchable database of documentation and critical lease information which can be exported to Excel.
A lease abstraction software can take the pain away from manual data entry of lease information across scores of documents, and even mitigate the probability of costly human errors. Unlike other forms of transactions, the churn is relatively higher for lease documents in real estate transactions; hence, the adoption of an AI-powered lease abstraction software can automate most tasks and perform them with a higher degree of accuracy. AI is the future in every sphere of life, and so is the case in the management of leases.