Revolution of Real Estate Valuation

Capital Bay is a vertically fully integrated alternative investment manager in the field of real estate. The real estate industry contributes about 20% to the German GDP – the automobile industry 4%. Further, in 2018, properties and buildings constituted 75% (EUR 15.8 trillion) of the value of all tangible assets in Germany, almost 5 times of the German GDP. However, valuation of these assets is mainly based on simplified DCF models, simply accruing and discounting rents, costs of operation and exit prices.

OUR MOTIVATION IS NOTHING LESS THAN TO REVOLUTIONIZE THE VALUATION OF REAL ESTATE ASSETS! As the insurance industry designed models for the prediction of the occurrence and size of hailstones, we intend to create a scientific calculation machine that precisely predicts future cashflows from real estate assets based on the development of micro- and macroeconomic parameters. Only with these accurate predictions we will be able to exactly determine the value of assets. The necessary data will be provided by 21st REAL ESTATE, a strategic partner of CAPITAL BAY. 21st REAL ESTATE is the market leader for real time real estate data. Its database is a complex framework of integrated data tiles that covers the entire area of Germany. From over 55 millions of complex interacting analysis tiles it generates 1.1 million output tiles of 200m x 200m within cities. 21st REAL ESTATE uses the most up-to-date spatio-econometric models and machine learning algorithms.

You will determine critical parameters influencing the value of assets and create models predicting the development of asset values during an investment period based on simulated macroeconomic scenarios. Finally, you will conduct overall validations of the results generated by the parameter simulator against actual market developments via feedback loops applying machine learning.