CBRE Investment Management gets the complete picture

Real estate investments

€28 billion assets under management (EMEA) | 14 offices in 17 countries

A smart investment starts with proper insight. CBRE Investment Management wants not only to examine the financial and legal aspects of real estate acquisitions, but also to have a clear view of technical risks. With Riskonet's Pre Acquisition Risk Assessment (PARA), the organization gets that complete picture – including fire safety, an aspect that standard due diligence often lacks.

Fire safety lacking in standard due diligence

Background

CBRE Investment Management – active in acquisition and management of commercial real estate – builds a thorough picture of each investment object. Financial analyses, legal checks, fiscal due diligence: all standard. But one essential question remained underexposed: does the object meet requirements for fire safety and compliance with international standards such as NFPA?

Technical due diligence often does not bring sufficient expertise to the table in this field. That risk is too great: deficiencies can lead to higher insurance premiums, uninsurability or even cancelled deals. CBRE wanted to map these risks in advance – and be able to use them in negotiations.

PARA as part of due diligence

Approach

Compliance with law and international standards

Riskonet’s PARA assessment checks compliance with laws and regulations as well as international standards such as NFPA. The report reveals where fire safety systems fall short and warns of issues that insurers might raise after acquisition.

Risk insight for better negotiations

Observed poor quality of security and fire safety systems, and non-compliance might give CBRE a better bargaining position when negotiating the purchase. Investment costs for necessary improvements can be subtracted from the total price of the takeover.

Rapid international deployment

Riskonet has access to a large network of specialists, international as well as national. If CBRE want to buy an asset in Italy or Spain, Riskonet is able to move rapidly and ensure experts promptly receive an assessment that meets CBRE’s requirements and standards.

"The added value is indisputable. Riskonet’s PARA assessment checks CBRE's compliance to laws and regulations as well as international standards such as NFPA. The report warns the company of issues that might come up after acquisition which might cause financial drawbacks in the long run. "

Better bargaining position

Observed deficiencies become an argument in negotiations. Costs for necessary investments in fire safety can be subtracted from the purchase price. A PARA can pay for itself in this way.

No nasty surprises after purchase

The report warns of issues that insurers might raise after acquisition – issues that can cost a lot of money in the long run. By knowing what is at stake in advance, CBRE can make conscious choices: invest, negotiate, or even decide not to purchase.

International scale advantage

Riskonet's worldwide network makes it possible to move rapidly. Whether it concerns an object in Italy, Spain or elsewhere: within a short timeframe there is a report based on local expertise, according to the same approach and quality standards.

How would this approach work for you?

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Get in touch with Chris Brits

Chris Brits

Johannesburg, South Africa

+27 8 345 67 424

chris.brits@riskonet.com

Your local partner

Chris Brits

CBRE Investment Management gets the complete picture

Fire safety lacking in standard due diligence

PARA as part of due diligence