Method Valuation

Method partners with Northumbria University to launch a commercial property AVM

Method Valuation UK Limited has teamed up with Northumbria University to develop a commercial property automated valuation model (AVM).

The collaboration, through the Knowledge Transfer Partnership (KTP) programme, is set to create and deploy an AVM for commercial property that has the potential to change the way that it is valued.
Their joint KTP application has recently received government approval, and now they are recruiting a suitable associate to lead the project, who will work within Method’s business for the duration.

“For a number of years, a commercial property AVM has been a holy grail for UK lenders,” said Niall Deas, director of operations at Method.

While residential AVMs have carved a niche for themselves in recent years, he believes a number of things have prevented a commercial property AVM from being developed, including fewer commercial properties compared to residential, less transparent data surrounding commercial property transactions, and this type of property being subject to more valuation-sensitive variables.
“The Method xi software system captures data from a variety of sources and in such a way that we have a host of data that will prove invaluable to the development of such an AVM,” he explained.
“But it’s not just by developing a commercial property AVM that we will be able to use data to assist our lender clients; in the shorter term, we will be looking to create a host of lending metrics which can be used to frame how a property sits within the wider marketplace.
“We think that these are exciting times with the analysis of big data helping lenders mitigate some of the risks to which they are exposed — being a fintech business permits us to be at the very forefront of such developments.”
Stephen Henman, managing director at Method, added: “This is an incredibly exciting development that has market changing potential for the way in which commercial property is valued in the UK. 

“We look forward to sharing the benefits of the partnership with our lender clients and more widely with the UK property market as we progress.”

Northumbria University academics helped conceive the two-year project and will provide academic input in mathematical modelling and statistics at regular project meetings with Method.  

KTPs aim to help businesses improve their competitiveness and productivity through the better use of knowledge, technology and skills within the UK knowledge base. 

John Clayton, knowledge transfer adviser at Northumbria University, commented: “KTPs enable a company to gain valuable competitive advantage and accelerate innovation by partnering with leading academics to create and embed new expertise, knowledge, skills and strategic capabilities."

This project was funded by UKRI through Innovate UK.

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