Cygnet West, Western Australia’s most prominent independent commercial real estate firm, boasts a remarkable legacy of 90 years operating in the local market. With an extensive portfolio encompassing approximately 1.5 million square metres of commercial, retail, industrial, and other assets throughout regional and metropolitan WA, the company has established itself as a formidable player in the industry.
In a significant move in 2021, Cygnet West decided to sever its franchise affiliation with a major global real estate service and investment management company. This strategic decision marked a turning point for the firm as it embarked on a fresh and autonomous path.
Recognizing the importance of advanced technology solutions for efficient property management, the company conducted an extensive review of its existing technology platforms. Consequently, Cygnet West forged a partnership with MRI Software, renowned for its best-in-class solutions. The successful implementation of these cutting-edge solutions significantly enhanced the management of its extensive property portfolio.
Denis Leane, Cygnet West’s Chief Financial Officer, expressed his insights on the project’s triumph. The collaboration with MRI Software led to an optimized utilization of data, fostering better decision-making processes. Additionally, it streamlined communication flows, boosting overall operational efficiency. The practical benefits of this transformation have not only positively impacted Cygnet West’s business operations but have also enriched the experiences of its broader client base.
Independence and innovation
“We wanted to be a truly independent and innovative company. And we wanted to have the ability and the agility to focus on our customers and be responsive to their needs.” stated Denis Leane, CFO of Cygnet West. With a workforce of over 140 employees and 15 service lines, technology played a pivotal role in maintaining our prominent position in the commercial real estate market.
As part of a major restructuring initiative, it became imperative for us to revamp our existing legacy technology swiftly and embark on a transition towards more advanced systems that align with our new vision and enhance client services. Central to this process were goals of improving data visibility, upgrading reporting systems, and optimizing overall efficiency.
Recognizing these aspirations, Denis emphasized, “We identified that our current systems and our franchisors’ systems were holding us back. And we decided to make the move to a more fit-for-purpose cloud-based solution.”
Collaborating with MRI Software and their trusted professional services partner, Loci Solutions, Cygnet West initiated the transformation from a less flexible on-premise system to a cutting-edge cloud-based solution. This move positioned us to streamline operations effectively and accommodate future scalability demands successfully.
Unparalleled Emphasis on Cutting-Edge Technology
Cygnet West’s leadership team recognized the importance of a successful long-term strategy that would involve harnessing quality proptech solutions and adopting a best-in-class approach for both the company and its clients.
After a thorough evaluation of various property management and CRM solutions available in the market, the team swiftly decided to transition from on-premise to cloud-based solutions, with MRI’s PMX emerging as the clear frontrunner.
Denis, a key member of the team, explains their choice, stating, “We found PMX was the best fit for us because it was the most well-known and respected in the market, and when we offer services to our clients, we want to have the best tools available to us.”
One of Cygnet West’s primary objectives was to streamline the vast amounts of data they gather and present it in a concise and actionable format to facilitate effective decision-making. Having access to transparent data through the PMX dashboard has proven to be a game changer for both investors and clients.
Denis highlights the overwhelmingly positive feedback they’ve received, noting that clients no longer need to wait for month-end reports to make decisions. With the ability to access and print reports from the PMX system at any time, on any day, clients appreciate the convenience and timely access to crucial information.
Successfully implementing change within a tight timeframe.
Managing an IT change management process can be a challenging endeavor, particularly when it comes to gaining the full cooperation of the staff in embracing new technologies.
Denis emphasized that the most significant aspect of the project was the change management aspect, which has been an ongoing process. He firmly believes that change management and effectively addressing resistance to change require a sustained effort rather than a quick fix.
During the restructuring phase, Cygnet West undertook a series of surveys and engagement exercises to identify the core values that the staff cherished and desired the company to be recognized for.
“We asked the staff to rate what they saw as the values of the company (and) we ended up with five. It was to be authentic, dedicated, passionate, collaborative, and fun.” Denis explained.
These values played a pivotal role in guiding the company through the demanding timeline for selecting and implementing the new system. Moreover, they facilitated the training of the staff and stakeholders to seamlessly adopt the new technology.
“We set out a detailed roadmap of how to transition, which included staggered implementations and a number of parallel runs. It also detailed how we were going to train and support our staff through the process, and we also set a go-live date (which) gave us a buffer before our old systems were switched off.” Denis added.
By prioritizing change management and embracing their core values, Cygnet West successfully navigated the challenges of integrating the new technology, ensuring a smoother transition for all involved parties.
The key to systems adoption and engagement lies in effective training
Once the staff at Cygnet West became proficient in utilizing the system, their primary objective was to ensure their ongoing active participation. To address any initial concerns about the platform’s complexity, the company introduced easily accessible and concise training sessions, aimed at supporting the staff’s continuous engagement with the system.
Denis explains, “We designed 15-minute flash training sessions that covered one particular topic. And staff found it easier to digest. In fact, most of these training sessions are anywhere from five to six minutes because people are busy. We’ve created about 60 flash training sessions now across our new systems.”
In addition to training new recruits at Cygnet West, Denis underscores the significance of task-specific training. He mentions, “We continue to roll out (training sessions) in onboarding for new staffers and also, for example, coming up to budget time, we rolled out a flash training just to give a refresher.”
Enabling clients to gain improved data access and automation capabilities.
Denis has highlighted the significant positive impact of PMX on client service and communication, as well as the newfound self-sufficiency and real-time access it has provided.
According to Denis, the implementation of PMX has streamlined processes and improved client service. While owners still have the option to wait for their monthly reports to be sent, the system has saved considerable time. For instance, if an owner has an accountant on-site, they can directly access invoices and see where they have been coded, eliminating the need to go through property managers and trust accountants via email. This direct access to information has enhanced efficiency and communication.
Cygnet West further improved tenant communication by integrating their existing eConnect software with PMX. This integration has automated the process of sending tenant invoices, resulting in significant time savings. In fact, the Retail and Commercial portfolios have collectively saved over 4,500 employee hours per year. The time saved has empowered the team to focus on providing added value to client assets.
With the reduction in time spent on administrative tasks, staff members can now dedicate more attention to essential aspects of client service, such as business growth, asset maintenance, and fostering positive tenant relationships. Automation has been a key driving force behind these efficiency improvements, allowing the team to accomplish their tasks more effectively.
Moving beyond ROI: Metrics and performance.
Cygnet West has experienced numerous advantages from adopting its new software, including significant cost reductions and the ability to generate additional top-line revenue by attracting a stream of new clients.
According to Denis, who spearheaded the software rollout, the company has witnessed a remarkable surge in submission requests from both existing management clients and potential ones. Even in the early stages of adopting the new software, there has been a substantial increase in the success rate of these submissions.
One noteworthy accomplishment attributed to the new systems is the substantial 18% growth in the management rent roll since January 2022. Denis emphasizes that the software has played a pivotal role in achieving this milestone, which is particularly impressive as management income constitutes more than 50% of the company’s total revenue.
However, beyond the numbers and financial gains, Denis, in his role as CFO, stresses the significance of other crucial aspects. He believes that while quantifiable returns are essential, they should not be the sole focus. Enabling staff to perform their tasks more efficiently and nurturing strong client relationships are equally paramount.
Denis articulates, “When you’re looking at new software it shouldn’t be 100% on your return on investment, I think you have to look at the less tangible benefits such as improved efficiencies, (and) also client satisfaction.”
Moreover, Cygnet West recognizes the considerable sustainability advantages associated with the new software. The reduction in paper usage and postage not only contributes to cost savings but also aligns with the company’s environmental commitments, promoting a more eco-friendly approach.
In conclusion, the adoption of the new software has proven to be a game-changer for Cygnet West. By providing cost reductions, attracting new clients, and improving submission success rates, the software has ushered in a new era of growth and efficiency for the company. Additionally, the emphasis on employee empowerment and client satisfaction underscores Cygnet West’s commitment to creating lasting value beyond mere financial gains.
Adapting to the Market with Technological Tools
Cygnet West’s extensive operations and the support of its dedicated research team position Denis as an authority capable of offering profound insights into the future of both Australian and global real estate markets.
Denis acknowledges that various influential forces, such as ESG (Environmental, Social, and Governance) considerations, the aftermath of the pandemic leading to a “flight to quality,” and the scarcity of housing, are significantly impacting the real estate market. Consequently, real estate businesses are increasingly relying on technology to stay competitive and discover fresh opportunities for stakeholders.
In Cygnet West’s view, Western Australia (WA) is set to play a crucial role in the global supply chain for many years to come. This development bodes well for the local economy, which in turn, has positive implications for the local property market.
Denis highlights that there is noticeable upward pressure on rental prices, particularly in core CBD locations, industrial and distribution assets, as well as inner suburban retail and residential properties. The scarcity of high-quality supply in the market contributes to this trend, which is particularly evident in the office space, where there is a notable “flight to quality.”
Furthermore, ESG considerations are increasingly becoming a priority for property owners. As such, this priority aligns with Cygnet West’s focus, prompting them to ensure that the buildings they manage are not only compliant with ESG standards but also equipped with smart solutions to meet evolving demands.