“Traditional credit metrics like DSCR and LTV only tell part of the story. With Placer data we can track foot traffic in near real-time, giving us a forward-looking view of property performance. This tool is a game-changer for our credit analytics team and our internal bank partners.”
-- Joseph Iorizzo, Managing Director, Portfolio Analytics & Credit Research
The Challenge
Webster Bank Seeks to Innovate Risk Tracking with Data-Backed Insights
Webster Bank, headquartered in Stamford, Connecticut, oversees $1.3 billion in loans on retail properties across the Northeast. With 200+ locations in Connecticut, Massachusetts, Rhode Island, and New York, Webster provides comprehensive commercial banking solutions. Keen to identify performance trends and relative risks across its retail real estate book of business, the bank engaged Joseph Iorizzo, Managing Director of Portfolio Analytics and Credit Research, to spearhead a data-driven approach to assess these loans' risk through foot traffic data. How could Webster Bank understand evolving property risk and make the most proactive, informed decisions?
The Solution
Creating a Mobility Composite Score To Inform Real-Time Risk Analysis Property by Property
The Webster team leveraged Placer’s data to create a unique Mobility Composite Score (MCS), which evaluates retail properties based on foot traffic patterns over time and on their relative performance in their submarkets.
Two core metrics comprise the Mobility Composite Score:
1. Mobility Index: analyzes foot traffic trends by comparing foot traffic from 2019 to 2024, establishing a baseline for each property and providing a clear view of how each property’s traffic patterns had evolved since pre-COVID times, offering insights into resilience and ongoing foot traffic.
2. Submarket Ranking: uses Placer’s CBSA (Core-Based Statistical Area) rankings to benchmark each property within its local market, comparing its performance to similar properties and helping the bank understand how each asset performs relative to its local competition.
Learn more about Visits Trend
Combining the Mobility Index and Submarket Ranking generated a single, actionable Mobility Composite Score that Webster Bank categorized as:
1. Red (Risky): significant risk of future underperformance (MCS<75)
2. Yellow (Watch): moderate risk, needs close monitoring (MCS< 110)
3. Green (Acceptable): low or negligible risk, with solid foot traffic trends (MCS ≥110)
This scoring system helped the bank to quickly identify underperforming loans and highlight areas for deeper investigation.
Uniform drops in traffic across all days suggested that it was not hybrid work on select days causing the decrease, but something more structural.
The Outcome
SUCCESS: Mobility Composite Score Provides Early Risk Detection for Bank Staff
The Mobility Composite Score has become an essential tool for Webster Bank’s team, providing timely insights into the $1.3 billion retail real estate portfolio’s property performance and enabling the bank to flag at-risk loans before adverse outcomes emerge. For example, in one market properties with a low MCS correlated with rising vacancies and tenant delinquencies - proving the effectiveness of the MCS as an early warning indicator for the bank.
Webster Bank continues to track and update the MCS across its portfolio, leveraging the information to dynamically monitor portfolio performance. This new, data-driven approach to risk management enables Webster to refine its lending strategy, reducing exposure to underperforming assets and focusing on properties better aligned with Webster Bank’s risk appetite.
