What's the fastest way to update your commercial real estate risk checklist?

1 Review your objectives

Before you update your checklist, you need to review your objectives and strategy for each property and portfolio. What are your target returns, holding period, exit strategy, and risk tolerance? How do your properties align with your goals and expectations? Are there any gaps or opportunities that you need to address? By clarifying your objectives, you can focus your checklist on the most important risk factors and indicators that affect your performance.

2 Scan the market

The next step is to scan the market and identify the trends and drivers that influence your property type, location, and sector. You need to be aware of the supply and demand dynamics, the competitive landscape, the regulatory environment, and the tenant preferences and behavior. You also need to monitor the macroeconomic and geopolitical factors that may impact your market. By scanning the market, you can update your checklist with the latest data and insights that can help you assess the value and potential of your properties.

3 Analyze the property

Once you have a clear picture of the market, you need to analyze the property and its performance. You need to look at the physical condition, the financial performance, the lease terms, the tenant mix, and the operational efficiency of your property. You also need to evaluate the environmental, social, and governance (ESG) aspects of your property, such as energy efficiency, sustainability, and social impact. By analyzing the property, you can update your checklist with the key metrics and criteria that can help you improve your property management and optimization.

4 Validate the assumptions

The final step is to validate the assumptions and projections that you use in your checklist. You need to test the sensitivity and robustness of your assumptions and scenarios against different market conditions and outcomes. You also need to verify the accuracy and reliability of your data sources and methods. By validating the assumptions, you can update your checklist with the best practices and standards that can help you reduce your uncertainty and increase your confidence.

By following these steps, you can update your commercial real estate risk checklist in a fast and efficient way. You can also use tools and platforms that can automate and streamline your checklist process and provide you with real-time and actionable insights. Updating your checklist regularly can help you stay on top of your risks and opportunities and make better decisions for your commercial real estate investments.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?