Finance  ·  CMBS

DBRS Considers Using Virtual Reality to Analyze CMBS Assets


A commentary from the Toronto-based credit-rating agency DBRS suggests that the company may one day use virtual reality to keep tabs on the properties that secure commercial mortgage-backed securities the agency rates.

When analyzing a new transaction, rating agencies routinely send analysts out into the field to visit each and every property with a mortgage that will be wrapped into the securitization. In some cases, that could mean that employees are dispatched to visit dozens of commercial assets across the United States and Canada–including budget hotels and far-flung warehouses well off the beaten path.

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Virtual-reality technology allows landlords to create a simulation of a full walk-through of a property and display it on a computer screen, a capability DBRS believes could one day cancel the need for all that costly travel.

“It has potential,” Wasiq Chughtai, a CMBS analyst at DBRS, said in the report. “The downside is that we wouldn’t be able to ask questions and benefit from the in-person interaction with a property manager.”

The technology could also help rating agencies and investors make rapid assessments of renovations and improvements that landlords make to properties.

“All [that] investors need are a few 360-degree captures [during each reporting period] to save a significant amount of time and money for travel expenses,” DBRS’ Stephanie Hughes, the author of the report, wrote.