Definition / Objective
Analyze the risks associated with the creation and operation of a real estate portfolio/fund for the purpose of presentation to investors, creditors, and for internal decision-making purposes.
Provide confidence and transparency to investors
Analyze volatility that may impact fund performance
Demonstrate accountability for fund return and risk objectives
Property Types / Opportunity
Identify potential risks at the fund and asset level that may impact performance or identify imbalances in risk and return.
- Identify potential risks of the real estate strategy – Develop tactics to counteract the effects of the fund’s external and internal risks
Approaches, Relevance & Methods / Solution
Perform a risk assessment that allows a reader to clearly visualize and analyze the risk factors of a fund.
- Analyze the risks at the fund level and each asset in the portfolio – Present a model to assess and visualize potential risks in a clear and objective way
Fund Level Risks
- Market Risk – Credit – Counterparty Risk – Operational Risk (Governance) – Liquidity Risk – Strategy Risk
Asset Level Risks (Performed for Each Asset of Portfolio)
- Market Risk – Credit Risk – Liquidity Risk – Business Risk – Operational Risk – Valuation Risk
Deliverable Structure & Scope
Perform a risk assessment that allows a reader to clearly visualize and analyze the risk factors of a fund.
- Analyze the risks at the fund level and each asset in the portfolio – Present a model to assess and visualize potential risks in a clear and objective way
Fund Level Risks
- Market Risk – Credit – Counterparty Risk – Operational Risk (Governance) – Liquidity Risk – Strategy Risk
Asset Level Risks (Performed for Each Asset of Portfolio)
- Market Risk – Credit Risk – Liquidity Risk – Business Risk – Operational Risk – Valuation Risk
