Commercial mortgage portfolio analysis benefits from having insight into loan performance at the property address-level. But a major challenge is how to comprehensively identify risk factors on a large scale. Learn how a rating service enhanced their workflow for analyzing property portfolios with real-time information from online news using Amenity contextual NLP technology.
Mortgage portfolio analysis benefits from having insight into loan performance at the property address-level. But one of the main challenges is how to comprehensively identify risk factors on a large scale.
A rating service approached Amenity to enhance their workflow for analyzing property portfolios with real-time information from online news using Amenity contextual NLP technology. Two key components that contributed to the success of this use case were
A rating service wished to address emerging issues that could have an impact on securitized loans. They assigned a team of 35 analysts to cover a number of real estate property portfolios that in total represented around 50,000 properties.
For each property, analysts would need to monitor for certain events ranging from tenancy issues to bankruptcy. And because so much of this information is not available from one site or in standardized reports, analysts would need to look for this information via online (and mostly regional) news sources.
There were initial attempts to gather information through manual web searches and by using Google Alerts. Both methods were impractical due to the number of properties and topics being covered. Google Alerts, specifically, is prone to picking up a lot of noisy data (i.e., bad or irrelevant data). An example is an analyst with alerts for activity concerning a mall property having to go through a lot of irrelevant emails because the Google tool is unable to distinguish “closing” as referring to business hours as opposed to a real estate transaction.
Amenity has several ready-for-use models that employ contextual NLP to parse text, and extract and aggregate business-related insights and sentiment scores. Amenity models are able to pull from a range of document sources, including earnings call transcripts, SEC filings, emails, online news, PDF reports, and more.
For this project, Amenity worked closely with the client to develop a custom model specific to their view of property loan analysis that would extract in real time the relevant information they were looking for from national and regional online news.
This communication does not represent investment advice. Transcript provided by FACTSET and S&P Global Market Intelligence.
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