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.
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.
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.
Process
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
