Structured Finance: CRE REIT
Digital Transformation
Case Study

Prepared by Robin M. Gregory, CEO
mobileLACE, LLC

The content herein is based on my own personal experience, observation, and analysis from personal execution, thru direct engagement with peers and interviews with ancillary participants involved in creating the de novo policies, procedures, and software – as strategic differentiators, for CBF a commercial real estate REIT. Executive team and guiding coalition were the main players during the initial roll-out of these strategies.


Thank you for choosing mobileLACE for your innovative digital transformation journey; Our Case Studies will show that Transformation Constraints can be mitigated by using our tested and proprietary, innovative solutions for technology and business provided inside our mobileLACE Digital Transformation Platform based on years of experience during corporate digital transformation.

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This 2-year case study involved a de novo, pre-IPO, CRE-CDO REIT, CBRE REALTY FINANCE (NYSE: CBF.)  CBF issued multi-level commercial real estate finance; later, the debt was structured into MBS CDOs – an investment instrument that insurance companies, pension, and hedge funds utilize to outperform the bond market or Treasury yields.

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As an Enterprise Business Analyst and Enterprise Transformation Coach and now – CEO, I have strategized solutions from the 1990s until 2019 when I took all of my collective, collated experiences from 25+ years to strategize the mobileLACE solution models and brand. Building flexible continuity or our “agile consistency dynamic” into operational, product and curriculum strategy via process and content was a challenge. The mobileLACE team took these pieces and developed and designed the platform into a presentation reality in 2020-2021.

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Transformation Constraints Contributing to Success/Failure:

*Risk Mitigation thru Technology

* Innovation as a Differentiator

* Digital Transformation Outliers Matter

* Cultural Value and Mission Alignment make or break an Executive Board.


The Y2k debacle made it apparent that technology did not yet see how to plan for future – and the radical, technological changes occurring. Simultaneously, society was becoming accustomed to doing whatever was good for them not the client. Herd mentality had fractured!

Global markets long intrigued by the entrepreneurial spirit of the United States wanted a piece of the action – and when NAFTA lifted the international capital markets began heavy investing in US real estate.  

I joined CBRE Realty Finance at its inception in 2005 – to build the Research Department: real-time property-level data, capital flow routes, and objective trends regarding probable success/default trends for commercial real estate mortgage lendng.

As a hybrid REIT – we structured our mortgage revenue streams into credit-rated tranches within structured MBS investments, or collateralized debt obligation to afford bond-like returns to corporate investors. 

My series 6, 7, and 28 as well as insurance licenses and financial planning experience, and long-time concentration in commercial and residential portfolio real estate gave me the right lens into what the committee needed to expedite their work. 

Keep in mind – a  psychologically safe environment needs to exist amongst any de novo leaders to ensure the clarity around their holistic, strategic, and purpose-driven intentions are carried out.

The Problem…

The C-level Committee that approved multi-level financing for Commercial Real Estate Mortgages, later bundled into CDO’s (collateralized debt obligations backed by the in-house mortgage issues) and in order to execute proper due diligence they required accurate, pre-analyzed, property-level data, mapped to econometric drivers that spoke to global trends, opportunities, costs, and risk.  

At the time of this pre-IPO venture, the data for this analysis would have to come from many sources; integrated solutions were not a “thing” as of yet. 

In addition, these decision-makers needed a way to acquire a clear understanding of underlying US market-cycle differences – trending between asset types and their exogenous influencers, to properly adjust loan risk factors that normally indicate default.

This would provide a level of assurance – internally and eternally that the collateral within the instrument’s tranches could remain credit worthy and revenue-continuous, thru the bond’s maturity.

Because the CDO – or super bond’s financial value relied on uninterrupted payment of debt as a means of sustaining its bond class rating and subsequent promise of a return to corporate investors, the truth of status changes was paramount. Wall Street or “the street” is very mindful of reporting accurately for their corporate investors – especially in a post-Lehman, Enron, WorldCom era – to avoid any ugly, ripple, market effects.

Data that juxtaposed potential default-risk profile reporting metrics – against macro-economics, afforded a peek at potential consequences from uncontrollable changes upon CRE, and for CBF this data performed two important validations:

The success of initial investment decisions – made to issue debt against the commercial real estate’s value (private)

Proper structuring for the asset’s underlying tranche revenue streams – created by the initial debt issuance, and necessary to sustain a healthy investment class, maintain good credit ratings, and hold value. In turn, this kept the REIT in good standing with “The Street” analysts, the investor, and ultimately the exchange as a viable investment firm (public)

The Solution…

Creation of a Market Ranking model that provided data per property type, in 54 markets – with trends that supported the issuance of Whole Loans, B-Notes, Mezzanine Debt, CMBS-Conduit, and CMBS Large Notes finance.
Accompanied by, a Meta-Search Library and Commercial Broker Contact App on a Digital Platform Dashboard. This afforded a blended, partially integrated, evaluation of econometric data, public sentiment, and real estate investment trends for Office, Industrial, Hotel, Multi Housing, and Retail property types – in the 54+/- United States markets – based on the experiences of professionals in real-time, and lagging empirical findings.  The solution afforded risk mitigation, differentiation, and investment transformation knowledge to the CBF Financial leadership – 24/7 – both in the office and on the Investment Banking Roadshow pre-IPO.

Solution Benefits:

Feature 1

Market Ranking Briefs:

Weighing statistical research that makes transparent – predictive analytics and trending fluctuations in real estate fundamentals like: vacancy; construction and absorption rates, would allow for pretty solid debt issuance decision making.

Feature 2

Corporate Library:

An immediately searchable document library – used for audit validation and or legal purposes as a source of support for debt issuance, was essential for CRE.

Feature 3

Contact Benefits:

The subjective understanding of impacts (related to consumer sentiment around geo-political change) that could set off default-risk despite positive macro-economics, was validated in real-time by connecting into the 2500 US CBRE affiliate offices in the 54 US markets. This transformed “old” swag decision making into a new blended collective wisdom – based on professional, reliable experiences and their outcomes.

3rd Party Data Context:

3rd Party Data Context:

Understanding commercial and or residential markets, requires a comprehensive and iterative analysis of 3rd party data – for both comparable sales and econometric trends. In 2005-2006 Torto Wheaton was the leading commercial real estate research firm – until 2009, when CBRE enlisted Ray Torto as the Global Chairman of CBRE Research after they were purchased by CBRE.

Our model included data from Torto, CoStar, and PPR for the following Trend Metrics:

  • probable income performance per property/per market
  • market pricing re: volatility and risk – both current and forecasted
  • portfolio pruning due to cycle change
  • capital markets with high predisposition or vulnerability to exogenous impacts– i.e. terrorist attacks, corporate trade, and tax policy changes, capital flow shifts, third world low-wage export increases, Federal policy changes and the financial impact from natural or social occurrences (i.e. coastal insurance costs to infrastructure for border in-migration)
CB Realty Finance portal dashboard, 2006.
CB Realty Finance portal dashboard, 2006.

Constraint 1:
Technology Risk Mitigation

Technology is a big transformation aspect for automation, value validation, and consistent environment builds for any company then – and now. If properly implemented it can provide shorter development time to market with higher quality; however, risk mitigation can only occur via technology solutions – if business intelligence prepares the execution of systemic automation, and or any other business value functionality used by the customer, but delivered by software with no human interaction.

Agile mindset and iterative development – familiar to the developer and myself, was used to get the technology model up and running in 8 months (before the IPO Roadshow.). The automation was built by the business intelligence of leading research companies and professionals.

GUI for the CBRE Finance Knowledge System circa 2006.
GUI for the CBRE Finance Library Knowledge System, 2006.

Constraint 2:
Innovation As Differentiator

Quantum creative thinking is required for innovation to be successful.

Seeing a problem with new eyes, and modeling the ideation iteratively – not being afraid of fails, and understanding how and when to apply patterns to non-linear connections in order to solve creatively is the quantum thinker’s weapon from Einstein to engineers and designers of today.

Since my inception as an entrepreneur in the late 80’s I’ve found innovative solutions to be my sweet spot. I applied at CBRE Realty Finance what is now coming of age; in 2007 I addressed our CRE finance solution with the same approach as I addressed the mobileLACE digital platform. Both were created to support initial and then later – interdependent connections, that were necessary to get to the C-level mission, vision, and strategy.


Like technology – buy-in from “all ” users must occur across the board and its vertical orgs, for any innovation solution to be used and therefore impactful (this dependence is true no matter how well thought out or super-automated the solution.)

Systems and software can not enable or deliver intended results if they are not embraced.

Executive mindset and their guiding coalition – need to be open to accepting diverse perspectives and new ways of doing things; the character and flexibility of leaders are key indicators – or offer a foreshadow of whether a digital transformation will succeed or fail.

CBRE Executives and Guiding coalitions at Wall St for the IPO trading opening, 2006.
CBRE Executives, and their Guiding Coalition at Wall Street for the IPO trade opening in 2006.

Constraint 3:
Experience vs. Theory

A personal theory is derived by observation from one’s own mental model around a personal experience (business or otherwise – they’re all personal.) As an enterprise analyst one does not inject individual personal theory – instead the analyst must gather objective, empirical and subjective (structured and unstructured data) from pattern observations, execution engagement or record of group actions/reactions.

Getting first-hand information to understand the root cause of specific personal or systemic responses – and then integrating it into a solution, is bringing collective theory in – to solve a collective problem.

The meaning of the experience of humanity vs. the personal experience of individuals and keeping the two separate yet a part of the perspective has everything to do with conducting good, solid, value-driven business solutions.

Personal agendas or cognitive bias is harmful to creative functionality.

2005 – 2007 Facts:

The face of decision-makers had not changed much at this time – it was white, male, conservatively dressed, educated, and connected. Individuals who could ingratiate top leadership – in whatever way possible, were often part of guiding coalitions.

Constraint: Experience was not yet fully integrated into solutions as much as hierarchical status and character force. The loudest often was heard first. (Request Mental Model Capability Module Info via mobileLACE survey)

While decentralized decision-making had already become a mandatory part of business success – the cultural and emotional intelligence needle had not moved to catch up yet. Often good intentions were thwarted by unconscious or consciously static and antiquated actions (more of the same – this is how we do it.)

Constraint: Conscious thinking was becoming more of the norm – herd mentality had fractured in favor of authenticity but full acceptance had not yet been achieved – still is not fully integrated. This dampened intuitive and smooth flow processes.

NOTE: mobileLACE Agile for Digital Executives discusses how to innovate your culture using creative disruption.

Digital 1.0 turned several industries around, and after a decade made Fortune 500 companies consider what the new S&P lifespan might look like in the future.

Digital Transformation and NAFTA – in 2005 – 2008 allowed start-ups to compete with Fortune 500 companies – to disrupt and innovate via emerging technology.

Digital 2.0 presents emerging technology coupled with innovation – for a never-seen-before fully open service model. For success, this requires the removal of old cultural norms and processes, and – while keeping some structured governance in place – consciously changing our mental models – is required.

Transformation in 2021 has over-priced unicorns driving markets, pandemic warfare, and old political trends damaging enough to almost beckon financial uncertainty round again!

It has packed a big reality punch – because we are now forced to react with negative urgency instead of proactive strength…

Paradigm shifts below have been accounted for in mobileLACE solution – because history repeats!

Due to lagging cultural intelligence not keeping pace with innovation driving our future – fast we’ve made the decision to err on the side of caution!

Covid 19- Impact CorporateCovid 19 Impact IndividualDownturn CRE BuyersShift From Central Office Market
Manage the telecommute employees for business initiativesChildcare while WFH – how will this work?Office Sub-Leasing for Younger Companies – Growing Start-Ups?Central Office Redundant Power; Internet and Security Costs – Do We Keep This Going?
Evaluate health safety and brand experience of WFH employeesHow Do I Manage Isolation with Mental HealthOffice Market – Highest and Best Re-Use?“Nice to have technology” becomes “Need to Succeed!”
What will Brick & Mortar Retail future look like?Ordering Online to Keep Up with Life Responsibilities – Not Because I Always Want To…Impact of Intermittent Shutdowns on Vacancy Rates and ValuesHow will the MBS Debt Market Be Impacted By The Re-Use Time Cycle?
How Do We Stay Healthy?Will I Be Safe At The Office?Add in Disinfection Costs and Interruption Insurance?What Does Property Maintenance Look Like With All Other Factors Considered?
What Does My new Supply chain Look Like?Will My Manual Job Become AutomatedRE-Use of Talent EssentialHow Do I Create Remote Cultural Intelligence?
How Do I Digitize Fast?I Will Change My Buying Habits Due To WFH And Downturn!Digital Transformations Need Authenticity To Attract Limited Buying Market!Risk Of Either Or Decision Making Will Be Instituted And Increase Inauthenticity!

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