Payment Trends in Commercial Real Estate: A Talk with JP Morgan Chase’s Jason Lee

Technology-based banking solutions are transforming treasury operations nationwide. As the markets in and around California offer their own set of opportunities and challenges, Partner Insights spoke to Jason Lee, a treasury sales manager within J.P. Morgan Chase’s Commercial Real Estate (CRE) business about the current trends, challenges and opportunities he is seeing in the market. 

Lee’s banking expertise extends two decades with deep dives into the complexities of cash management in treasury products.

Commercial Observer: What markets and asset classes do you support in your position at J.P. Morgan Chase?

Jason Lee: We support the largest, privately held real estate companies on the West Coast with a focus on developers and owner-operators of Class A office space and luxury multifamily properties. We also work with several private equity funds and have a few publicly traded real estate firms in our portfolio.  

In real estate banking, we support clients across several asset classes but with the advent of e-commerce, owner-operators in the industrial real estate sector have played a huge role in the renewed growth of CRE. 

Why do you think using a CRE-specific lens is important for viewing trends happening in treasury operations and payments?

The mechanics supporting these companies is all about liquidity. They need to process payments, collect rent and make lease payments through 12 cycles every year. There’s also capital calls and distributions going on at the same time. Relationships with their investors is a critical piece of their business. When they purchase, acquire or sell assets, which is something they consistently do, the certainty of payment execution in a timely manner is critical. 

What treasury and payment trends are you seeing in your areas of oversight?

The West Coast is very technology focused and we tend to see a correlation with our real estate clients attaching that same emphasis within their organizations. They’re looking at how can they use technology to become more efficient, especially with their treasury and accounting operations. 

This leads to discussions about the electronic payment options and data transmission as we continue to move away from the traditional checks as a payment instrument. These companies really want to be on the cutting edge in how they operate internally, so we’re way beyond paper bank statements going out through the mail. 

Our clients rely on our firm to provide efficient treasury and accounting tools, which leads into the reporting piece of the puzzle. Solid reporting gives them better visibility on their cash positions and the ability to optimize their liquidity.  

What do you think is your client’s most important criteria when choosing a financial partner?   

For our clients to function efficiently, they need a team that understands their business needs. The timing of these transactions combined with the size, which in most cases is high dollar investments, combined with the high volume of transactions, requires seamless teamwork. If you think in terms of having a 20,000- to 50,000-door real estate multifamily portfolio, reliability in a financial partner is a huge factor. Working with them means being able to track all the payments simultaneously and monitor where the funds are going. 

San Francisco and the Bay Area are still great places to live and work. The good assets in trophy buildings are either occupied or in the process of filling out, which correlates with the quality of our clients. 

Farther south in L.A., there’s been a lot of momentum with redeveloping areas that had been neglected. It’s even more important here to have the right building in the right location and the right demographics.

What’s next for you and your team?

We’re looking to expand into new markets and grow our existing relationships. This means I’m responsible for bringing our firm’s capabilities to our clients while continuing to develop my team. While we’ve had a strong presence in the West, my team has grown rapidly over the last six years, and we have expectations to continue with the same growth rate. This includes finding top talent with commercial real estate expertise and the treasury and banking skill sets needed to make our clients successful.