New Tech Offering to Automate Property Tax Appeals and More

Two Los Angeles-based companies are merging their respective expertise in artificial intelligence and commercial real estate through a partnership rooted in streamlining some of the industry’s most tedious and costly tasks.

The product offering, dubbed Fore Real, is the brainchild of artificial intelligence firm Fore Enterprise with support from Pegasus, a commercial real estate advisory platform with $4 billion of assets under management. Fore Real focuses on four services: property tax appeals, insurance compliance, lease abstraction and tenant communications. 

Pegasus provided the use of data from its portfolio as a participant in the joint venture. Fore brought technical expertise, accumulated over its 4-year history as a private company.

Tyler Hochman — CEO and founder of Fore Enterprise and Forbes 30 Under 30 alum — said the chance to build an AI platform from the ground up, informed by real data from a firm with more than 400 properties in its portfolio across 37 states, was a unique opportunity. By creating a product trained with a high volume of data points and then reviewed by a human, Jack Schoenfeld, Fore’s chief growth officer and head of Fore Real, said the team was able to achieve “high model accuracy, but also high human certainty.”

“We embedded ourselves into Pegasus and did a lot of case work and a lot of prompt tuning and training on, literally, their brain,” Schoenfeld said. “They have over 1,000 tenants and so there’s so many nuances and use cases and so that forced us to uncover [a variety of] edge cases where the logic is a little different.”

As the emergence of AI gets harder and harder to ignore, Pegasus CEO David Chasin said the firm had experimented with several other AI-driven technologies and automation tools but took issue with the levels of accuracy they were able to produce. The Fore team claims its models have 98 to 99 percent accuracy — and in putting it to the test with his business, Chasin agreed, saying their work is “the closest to perfection” you can get. 

“We can’t ever be in a situation where something got screwed up, and our client comes to us and says, ‘How did this get screwed up?’ And then we say, ‘Oh, well, the AI screwed it up,’” Chasin said, referring to why he’s shied away from other offerings.

Fore Real employs a workflow where its solutions go through a variety of tests from multiple AI agents each evaluating the product  — for example, a lease document — through different lenses and degrees of logic. The final agent before the human review process is the gatekeeper agent, or “the Grinch” as Schoenfeld calls it, which is the most critical and “pessimistic” agent. 

For lease abstraction, which Chasin referred to as a “huge time and resource suck,” the multi-agent approach is crucial, because a lease needs to be studied through the lenses of lenders, management, maintenance, buyers, insurance, etc. So if that process can be automated accurately — with final sign off from a human — there’s a significant upside in that. Chasin sees Fore Real as uniquely qualified to produce that given the tech expertise of Fore Enterprise informed by Pegasus’ “billions of lines of data,” which trained the AI.

In terms of Fore Real’s property tax appeal function, Schoenfeld said many property managers currently outsource those services, and the service providers take a cut.

“Not only is AI doing it faster and in some cases much better, we’re able to give all that upside back to our clients,” he said.

Considering the volume of tax districts spread across the country, an automated property tax appeal process has value, said David Stifter, CEO of PredictAP, an AI-driven invoice system for real estate companies. PredictAP boasts big name clients such as Related Group and CBRE. 

That focus area also implicitly has good access to data, he said, making it a good fit for AI. On the other hand, looking at lease abstraction, Stifter said the success of this function is dependent on how tailored an AI tool can be to a variety of customers, given varying preferences and processes for lease documents.

“The tax information can fit in a nice, structured bucket, while leases can be very unstructured,” Stifter said, noting that the insurance compliance element falls somewhere in the middle. “The devil’s in the details.”

With the official launch of Fore Real, the team aims to loop in other firms in addition to Pegasus. 

“We have that foundation that’s really strong, and then we are ready and able to modulate or adjust to any future firm,” Schoenfeld said, adding that that’s the difference between Fore Real and ChatGPT, where outside-the-box thinking is limited.

As it stands, Chasin defined the two firms’ relationship as “a casual joint venture,” noting that Pegasus is interested in doubling down after seeing proof of concept and is in discussions about taking an equity stake in Fore Real. 

Given how fast AI is evolving and the ease at which companies are able to build their own tools internally, new independent products coming to market must “provide value add above and beyond what the existing AI models already bring on their own,” said Gregor Schubert, a professor at UCLA who teaches a course centered around real estate and technology. One way to accomplish this is extensive data access.

“For instance, an outside vendor might bring in data they have collected from other users, and therefore they can provide a capability that I couldn’t provide in house for myself,” Schubert said. “They might bring in a more complex technology back end that is not just a simple dashboard, but rather some sort of proprietary algorithms that do something.”

Schoenfeld described Fore Real as a “living and breathing platform that’s going to continue to grow its capabilities” based on continuous influx of data as they add new clients.

Another way to differentiate yourself in the world of AI, Schubert said, is by offering an integrated platform, where each AI solution or function can interface with one another and thus be additive. Looking at the four components of Fore Real, this could mean the tenant communication aspect could pull data on a tenant from its lease abstraction element — such as rent price or lease length — to fine tune its approach to communicating with the tenant.

“A lot of the value there comes from the connection to the other databases and other functionalities that you’d want to have in an interaction with someone,” he said.

That’s one of the reasons Fore Real decided to make its services into one package, rather than individual offerings, Schoenfeld said. 

As AI implementation can sound alarm bells for layoffs, Chasin said Pegasus will not take that approach. Rather, its focus will be on putting more attention on interfacing with clients with the free time employees will have as a result of automation.

Whether you like it or not, AI is reshaping industries and real estate is no exception.

“I don’t think companies get a choice,” Schubert said, when it comes to implementing AI or not. “Change is happening — It’s not a thing that you can choose not to be a part of, because that would mean not being a part of your industry two or three years from now.” 

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