In 2018, the top 10 Lease Accounting software vendors accounted for nearly 40% of the global Lease Accounting market which grew 26.2% to approach nearly $770 million.
Last year RealPage, was the market leader with 7.8% market share riding on a 20% jump in revenue. Odessa Technologies was #2 followed by Cassiopae, a Sopra Banking Software Brand, CoStar Group and Oracle.
We ask the simple question: Who’s buying Lease Accounting applications from whom and why? And we provide the answers – supported by decades of research – to our clients around the world. (Sample from our Apps Database)
| Exhibit 2: Worldwide Lease Accounting Software Market 2018-2023 Forecast, $M | |||
|---|---|---|---|
| Year | 2018 | 2023 | 2018-2023 CAGR, % |
| Total | 770 | 3450 | 35% |
Source: Apps Run The World, December 2019
Lease Accounting Market Definition
- Automation of lease accounting process for proper reporting on corporate balance sheets
- Lease lifecycle management from set-up to onboarding to termination for end-to-end lease administration
- Contract management under a multi-level contract structure
- Standardization of lease determination and classification
- Measurement of Right-of-Use assets and lease liabilities
- Lease management that facilitates lease modification, remeasurement, and asset causalities
- Compliance and reporting capabilities that meet audit and disclosure requirements from financial accounting bodies such as IASB, FASB and IFRS as well as government agencies such as the Securities and Exchange Commission in the US.
Top 10 Lease Accounting Software Vendors
Here are the rankings of the top 10 Lease Accounting software vendors in 2018 and their market shares.
| Rank | Vendor | 2017 Lease Accounting Apps Revenues, $M | 2018 Lease Accounting Apps Revenues, $M | YoY Growth | 2018 Lease Accounting Market Share, % | Recent Developments |
|---|---|---|---|---|---|---|
| 1 | RealPage | Subscribe | Subscribe | 20,0% | Subscribe | In December 2019, RealPage closed its acquisition of Buildium, a real estate property management solution provider with approximately 2 million units under management in the SMB market segment. |
| 2 | Odessa Technologies | Subscribe | Subscribe | 21,4% | Subscribe | Odessa launched the Odessa AppStudio, a low-end development platform that allows business users to expand LeaseWave and quickly build new custom business applications. |
| 3 | Cassiopae, a Sopra Banking Software Brand | Subscribe | Subscribe | 25,0% | Subscribe | Banco BNP Paribas Brazil has selected its Cassiopae Financing Software to manage the bank guarantees business. They are accelerating its digital transformation and redesigning all of its services to create a seamless customer journey. The bank will use Cassiopae software to manage and automate processes for collateral, guarantees, and foreign exchange products. The software’s web services architecture will facilitate interfaces to existing and anticipated systems. |
| 4 | CoStar Group | Subscribe | Subscribe | 29,2% | Subscribe | CoStar Group acquired Cozy Services Ltd., with plans to integrate its innovative renter screening and rent payments solutions into Apartments.com |
| 5 | Oracle | Subscribe | Subscribe | 12,5% | Subscribe | In February 2019, Oracle announced an update to Oracle E-Business Suite that provides support for IFRS16 and ASC842 accounting standards changes for equipment lessees. The update to support these accounting standards changes for equipment lessees is delivered in consolidated patch sets to Oracle Property Manager. Oracle Financials users are granted Restricted Use of Oracle Property Manager for the purpose of accounting for equipment expense leases. |
| 6 | IBM | Subscribe | Subscribe | 31,6% | Subscribe | More than one-third of the Fortune 100, and hundreds of other companies, have chosen IBM TRIRIGA. |
| 7 | LeaseAccelerator | Subscribe | Subscribe | 200,0% | Subscribe | In July 2019, LeaseAccelerator acquired Guardian Global Systems, an Australian-based provider of Real Estate Administration SaaS to commercial and government organizations. |
| 8 | MRI Software | Subscribe | Subscribe | 26,4% | Subscribe | In July 2019, MRI Software acquired ProLease, a provider of lease administration, lease accounting, lease analysis and workplace management applications. |
| 9 | PayLease | Subscribe | Subscribe | 25,0% | Subscribe | In 2019, PayLease released a new business intelligence and reporting platform, called Portfolio Insights Dashboard. The Portfolio Insights Dashboard highlights critical operational metrics and provides detailed charts and reports, giving property owners and managers a thorough understanding of utility expense and recovery performance trends across their portfolio. |
| 10 | Nakisa Inc. | Subscribe | Subscribe | 41% | Subscribe | With the launch of Nakisa Lease Administration 5.0, Nakisa is introducing a new Financial Analysis Reporting Module |
| Subtotal | Subscribe | Subscribe | 28,1% | Subscribe | ||
| Other | Subscribe | Subscribe | 25.0% | Subscribe | ||
| Total | Subscribe | Subscribe | 26,2% | Subscribe |
Source: Apps Run The World, December 2019
Lease Accounting Market Forecast Assumptions
Drivers and Inhibitors of 2023 Lease Accounting Applications Market Projections
- Adoptions of Lease Accounting applications by publicly-traded companies in 2019 are expected to surpass those of privately-held organizations because of the former’s deadline pressures to apply the leasing standard for annual reporting beginning after December 2018, while the latter will begin after December 2019.
- Recent surveys place only 43% of public companies are implementing a Lease Accounting tool, suggesting the majority of those affected the most are still searching for the right solution. Capturing these accounts would require Lease Accounting applications vendors to deliver more templates for quick and easy data migration while investing heavily in professional services to handle the exceptions.
- The need to meet the new lease standard reporting could result in a mix of chaos and stop-gap measures, similar to recent compliance requirements like GDPR for safeguarding European privacy rights. Thusly Lease Accounting applications vendors will need to boost brand awareness and ecosystem building in order to be shortlisted by prospects.
- Our forecast assumptions call for a rapid pickup in demand for Lease Accounting applications by 2021 because of deadline pressures with sales beginning to level off through the forecast period.
- With a global installed base of more than 750 million Excel users including many in the accounting profession, meeting the new Lease Accounting reporting standard by using Excel – at least as a stop-gap measure – will be common. However, most companies will ultimately choose to adopt a more robust tool because of fears of noncompliance, limitations of Excel in a collaborative environment, and the increased popularity of Cloud services for financial reporting that have rendered the use of Excel obsolete.
- Our forecast assumptions estimate that the TAM for Lease Accounting applications could top 20,000 companies through the forecast period, while fewer than 200 companies would actually use Excel as a reporting substitute. That is based on growth trajectory of similar Cloud services for Customer Service and Support(popularized by Zendesk), Treasury and Risk Management(Kyriba and ION’s Reval) as well as IT Service Management(ServiceNow), all of which have been able to secure thousands of customers in a short amount of time because of their ease of use and ability to demonstrate superior value and efficiency gains over Excel-based solutions.
- Conversely, Excel-based reporting tools such as Excel4Apps(now a part of Insight Software) that are designed to prolong the use of Excel for ERP reporting remain a niche market with a little over 1,000 customers and 155,000 users even after more than a decade of extending the lifespan of a productivity tool that may end up costing users more time and resources because of its inherent limitations.
Inhibitors
- Impact of recent mergers and acquisitions in Lease Accounting and Real Estate Management applications markets could disrupt near-term investments as customers reevaluate the competitive landscape because of potential lock-in by acquisitive vendors like Fortive (Accruent, Gordian), Oracle (Aconex, Skire and Textura), Roper (Powerplan), Sopra Banking (Cassiopae), VTS (Hightower), and Wolters Kluwer (Tagetik).
- Pricing pressures will intensify as suite vendors like RealPage, Oracle, SAP, Yardi, etc. gun for increased market share at the expense of margin.
- Lease Accounting applications are typically priced between $100 and $1,000 per user per month. A major account with three to five users with hundreds of units on leases can pay anywhere between $30,000 and $100,000+ for use of Lease Accounting applications. Prices could tumble as vendors race to discount heavily to lure procrastinators and fence-sitters.
- Making Lease Accounting applications easy to use is critical for a new generation of users. More important is the need to make such implementations easy to run in order to help build business case for finance professionals by convincing them to prioritize Lease Accounting as the key to cost reduction and process improvement.
- The same priority applies to extend Lease Accounting to adjacent and suite products for facility and property management, a key purchase criterion that could put some best-of-breed players at a disadvantage.
Custom data cuts related to the Lease Accounting market are available:
- Top 100 Lease Accounting Vendors and Market Forecast 2018-2023
- 2018 Lease Accounting Market By Industry (21 Verticals)
- 2018 Lease Accounting Market By Country (USA + 45 countries)
- 2018 Lease Accounting By Region (Americas, EMEA, APAC)
- 2018 Lease Accounting Market By Revenue Type (License, Services, Hardware, Support and Maintenance, Cloud)
- 2018 Lease Accounting Market By Customer Size (revenue, employee count, asset)
- 2018 Lease Accounting Market By Channel (Direct vs Direct)
- 2018 Lease Accounting Market By Product
Lease Accounting Vendor Overview
RealPage
Odessa Technologies
Odessa offers software designed for the leasing industry by providing the LeaseWave system and Odessa platform to power a diverse customer base of leasing companies globally. LeaseWave is a powerful, end-to-end, extensible solution for lease and loan origination and portfolio management. The platform further delivers rich feature sets including low-code development, test automation, reporting and business intelligence to ensure organizations can more effectively align business and IT objectives.
Cassiopae, a Sopra Banking Software Brand
Cassiopae, a Sopra Banking Software product, specializes in global finance and asset management software. Highly-configurable, Cassiopae supports leases, commercial loans, business loans, construction loans, equipment finance, vehicle finance, vendor finance, and real estate and fleet management. Cassiopae software is helping manage a wide range of basic to complex, performing and non-performing loans, leases, and assets at over 500 client sites in 40 countries.
CoStar Group
CoStar Group provides information, analytics and marketing services to the commercial real estate industry. Its integrated suite of online service offerings include information about space available for lease, comparable sales information, tenant information, information about properties for sale, internet marketing services, analytical capabilities, information for client’s websites, information about industry professionals and their business relationships, data integration and industry news. It operates through the geographical segments of the United States and International. Its subscription-based services consist primarily of CoStarSuite and Focus services.
Oracle
OLFM stands for Oracle Lease and Finance Management. It also has been known as OKL (Oracle for Lease) and OLM (Oracle Lease Management) earlier. This product was developed as a software solution for Equipment Leasing Industry.
OLFM is fully integrated into Oracle E-Business Suite, one of its major ERP brands. It was developed on the technical foundation of Oracle Core Contracts, along with other products like Service Contracts, Royalty Contracts, Sale Contracts, etc.
First release of OLFM was done sometime in 2001 with 11.5.8. The latest release is R12.2.x and has the same technology stack (OA Framework) as other products of Oracle.
IBM
IBM TRIRIGA is an integrated workplace management solution (IWMS) that includes modules designed to accommodate the needs of operational, financial and environmental performance.
Key features include environment and energy management, capital project management, lease accounting and facility management. IBM TRIRIGA provides users with a lease manager that provides information to users about the present and previous asset value, amortization summary and upcoming lease updates and changes.
It also provides financial information of real-estate contracts in order to get a summary of lease expenses that are pertaining to a particular portfolio.
LeaseAccelerator
LeaseAccelerator offers software-as-a-service (SaaS) for Enterprise Lease Accounting, proven to be the simplest, fastest and easiest path to compliance with the new FASB and IFRS standards. Using LeaseAccelerator’s unique Global Lease Accounting Engine, customers can apply the new standards to all types of leases – real estate, equipment and embedded – at the asset level as specified by FASB and IASB. The company’s ecosystem of certified, global partners offers a variety of guaranteed turn-key solutions. On average, the firm’s Sourcing and Management applications drive savings of 17 percent with smarter procurement and end-of-term management – compliance plus ROI.
MRI Software
MRI Software LLC provides business management software solutions, offering real estate enterprise software applications and hosted solutions for investment analysis, budgeting and forecasting, portfolio modeling, fund and lease accounting, and commercial management. MRI Software serves multi-family and commercial property industries worldwide.
PayLease
PayLease provides online payment, billing, and utility expense management tools to property management companies, HOAs, and residents. PayLease provides tenants with convenient online payment options that are easy to use and are bolstered by the highest levels of security and customer support. PayLease simplifies property manager workflows through seamless integrations, increases net operating income, and enhances resident relationships. The vendor has over 4,500 clients, supporting in excess of 12 million residents.
Nakisa Inc.
In July 2019, Nakisa released Nakisa Lease Administration, which helps global organizations comply with new lease accounting standards by automating, centralizing and simplifying lease accounting operations. The latest release offers key additions to the accounting and administration functionality, a brand-new reporting engine, a new API platform and suite of APIs, and enhancements to Nakisa’s cloud technology.
Nakisa, who already have offices in Canada, Germany, Singapore and Pakistan has seen rapid growth for its solutions in lease accounting and organizational transformation in the United States and Latin America in recent years.
In June 2019, Nakisa Lease Administration has achieved ‘Integrated with Oracle Cloud’ status and is now available in the Oracle Cloud Marketplace offering added value to Oracle Financials Cloud customers.
Lease Accounting Win/Loss Analysis As Part Of Enterprise Applications Buyer Insight Customer Database
On the buyer side, customers are investing in Lease Accounting based on new features and capabilities that are expected to replace their existing legacy systems. In many cases, competitive upgrades and replacements that could have a profound impact on future market-share changes will become more widespread.
Since 2010, our global team of researchers has been studying the patterns of the latest Lease Accounting purchases by customers around the world, aggregating massive amounts of data points that form the basis of our forecast assumptions and perhaps the rise and fall of certain vendors and their products on a quarterly basis.
Updated continuously, our database features extensive Lease Accounting win/loss analysis. Each quarter our research team identifies tens of thousands of these Lease Accounting customer wins and losses from public and proprietary sources.
The research results are being incorporated into regular updates in our Enterprise Applications Buyer Insight Customer Database. You can access the Lease Accounting Quarterly Win/Loss Analysis Scoreboard and our Enterprise Applications Buyer Insight Customer Database by becoming a subscriber.
List of Lease Accounting Customers
Source: Apps Run The World, December 2019
Further Readings
An expanded version of this report covers the top 50+ Lease Accounting software vendors, offering in-depth analysis of the market dynamics, vendors’ Strengths, Customers, Opportunities, Risks and Ecosystems as well as their ability to gain Shares (SCORES) within their respective space.
We also offer win-loss analysis of the quarterly wins of these top 10 Lease Accounting software vendors and whether incumbents and upstarts pose any real threat to their standing amid shifting market requirements and user preferences.
More Enterprise Applications Research Findings
Based on the latest annual survey of 3,000+ enterprise software vendors, Apps Run The World is releasing a number of dedicated reports, which profile the world’s 500 largest Enterprise Applications Vendors (Apps Top 500) and the world’s 500 largest Cloud Applications Vendors (Cloud Top 500) ranked by their 2015-2018 product revenues.
Their 2018 results are being broken down, sorted and ranked across 16 functional areas (from Analytics and BI to Treasury and Risk Management) and by 21 vertical industries (from Aerospace to Utility), as shown in our Taxonomy. Further breakdowns by subvertical, country, company size, etc. are available as custom data cuts per special request.
Research Methodology
Each year our global team of researchers conducts an annual survey of thousands of enterprise software vendors by contacting them directly on their latest quarterly and annual revenues by country, functional area, and vertical market.
We supplement their written responses with our own primary research to determine quarterly and yearly growth rates, In addition to customer wins to ascertain whether these are net new purchases or expansions of existing implementations.
Another dimension of our proactive research process is through continuous improvement of our customer database, which stores more than one million records on the enterprise software landscape of over 100,000 organizations around the world.
The database provides customer insight and contextual information on what types of enterprise software systems and other relevant technologies are they running and their propensity to invest further with their current or new suppliers as part of their overall IT transformation projects to stay competitive, fend off threats from disruptive forces, or comply with internal mandates to improve overall enterprise efficiency.
The result is a combination of supply-side data and demand-generation customer insight that allows our clients to better position themselves in anticipation of the next wave that will reshape the enterprise software marketplace for years to come.
