scholarly journals Enhanced Cash Flow Valuation in Real Estate Management by Integrating Innovative Materials and Risk Assessment

2020 ◽  
Vol 12 (6) ◽  
pp. 2201
Author(s):  
Patrick Bergmann ◽  
Endre Kamarás ◽  
Werner Gleißner ◽  
Edeltraud Guenther
Keyword(s):  
Risk Assessment ◽  
Risk Management ◽  
Real Estate ◽  
Cash Flow ◽  
Flow Model ◽  
Material Selection ◽  
Life Cycles ◽  
Real Estate Development ◽  
Project Risk ◽  
Real Estate Projects

Environmental criteria have become a critical issue for the evaluation of projects and products, particularly for businesses with extensive life cycles. Sustainability criteria and project risk management are underexplored in real estate development, and thus endanger business survival. The aim of this article is to improve the understanding of uncertainties in the real estate industry by using a stochastic risk assessment approach and to broaden the risk assessment methodology. Thus, this article investigates the importance of material selection regarding external and project risk for real estate development. Aside from conventional projects, risks are analyzed for projects with high-quality materials (HQMs) that are characterized by environmental benefits. In following a mixed method approach, we began by conducting interviews with developers about the most important risks, and later incorporating these factors into a stochastic cash-flow model. Finally, we illustrated our findings in a case study. Overall, the highest risks were shown from resource prices and changing regulations, while the rankings of the two materials differ slightly; HQMs rank higher on the created risk index than conventional materials. The cash-flow model shows that conventional materials perform slightly better than HQMs, although uncertainties within the calculations are similar. The article contributes to risk management and decision-making for real estate projects by providing insights into the discussion and analysis of the financial performance of sustainable construction material and design that might be crucial for disruptive innovations. We present a model that integrates environmental and long-term effects in the cash-flow evaluation of real estate projects, thereby increasing managerial flexibility.

RISK ASSESSMENT ON DESIGN AND BUILD PROJECTS – A COMPARISON OF CONTRACTORS, CONSULTANTS AND OWNERS PERCEPTIONS

2016 ◽  
Vol 3 (2) ◽  
Author(s):  
Sabihah Saaidin ◽  
Intan Rohani Endut ◽  
Siti Akmar Abu Samah ◽  
Ahmad Ruslan Mohd Rizduan ◽  
Nur Nabihah Abd Razak
Keyword(s):  
Risk Factors ◽  
Risk Assessment ◽  
Risk Management ◽  
Cash Flow ◽  
Early Stage ◽  
Government Agencies ◽  
Management Process ◽  
Survey Questionnaire ◽  
Project Risk ◽  
Risk Management Process

Design and Build (DB) has been classified as the most risky project due to the complexities and uniqueness of the project itself. Appropriate identification, analyzing, controlling and monitoring for the project risk are required to minimize the risk in DB projects. It is essential that all parties play an important role in minimizing risk inherent in design and build projects. Therefore, this study has been carried out to conduct risk assessment on design and build projects by the comparison of contractors, consultants and owners perceptions. To achieve the objective, the survey questionnaire was distributed among contractor, consultant and owner, that were directly involved in design and build projects. A total of 128 useable questionnaires were received and analyzed using mean ranking, Kruskal-Wallis and Mann-Whitney Test. The result of these analyses shows that the contractors, consultants and owners have the same insight in risk factors presented namely: “client financial capability” and “inadequate cash flow by contractor”. There are no significant differences in between all parties except “bureaucracy in government agencies” and “inflation”. This study helps to increase understanding of contractors and owners on the importance of implementing risk management process at early stage of the projects.

scholarly journals THE CURRENT STATE OF PROJECT RISK ASSESSMENT AND EDUCATION NEEDS IN PROJECT RISK MANAGEMENT

2019 ◽  
Vol 7 ◽  
Author(s):  
Matej Masár ◽  
Mária Hudáková
Keyword(s):  
Risk Assessment ◽  
Risk Management ◽  
Project Managers ◽  
Project Risk Management ◽  
Project Risk ◽  
Qualitative And Quantitative ◽  
Current State ◽  
The World ◽  
Project Risks ◽  
Project Risk Assessment

Current trends show that education in the field of project risk management is a very actual topic. Long - term projects, which was realized in 2018, was mainly focused on R&D across the world. Short - term projects, was focused on innovation and improve manufacturing processes. Many projects failed because project managers did not manage project risks. Project managers have less knowledge and skills on how to effectively manage project risks, especially risks in the planning phase of projects. The main aim of this article is to analyze the current state of usage project risk assessment across the world, based on own empirical research, which was provided, by authors in 2018 and 2019 (mainly level of usage project risk management methods, experience and level of education). The research focused on analyzing the current state of project risk assessment among continents. The authors focused on the average level of use qualitative and quantitative project risk analysis by project managers, level of project risk management experience by project managers and complexity of learning in using of qualitative and quantitative project risk management methods and tools.  Some recommendation were established to educate project managers in the field of project risk management.

Project Risk Management Process for Professionals

2018 ◽  
pp. 277-299
Author(s):  
Tamas Toth ◽  
Zoltan Sebestyen
Keyword(s):  
Risk Assessment ◽  
Risk Management ◽  
Risk Category ◽  
Project Risk ◽  
Risk Management Process ◽  
Minimum Requirements ◽  
Integrated Project ◽  
Assessment Procedures ◽  
Project Risk Analysis ◽  
Project Risk Assessment

This chapter will provide an instantly applicable integrated project risk analysis method, which tracks the probabilities of the occurrences of harmful events perceived by the owners from the conceptual phase to the end of the project. The chapter follows a threefold structure. First, the paper provides a revised integrated project risk assessment framework that enhances conventional risk category-based methods. Second, the minimum requirements of the owners are clarified to attain the main goal of project risk assessment and to identify the harmful events jeopardizing this goal. Third, the widely known risk assessment procedures are revised, and a methodology for taking and selecting proper risks is provided. Finally, a new valuation approach to the monitoring phase is introduced, which is able to capture the current market value of the project based on the risk management and controlling system's data.

Project Risk Management Process for Professionals

2018 ◽  
pp. 725-747
Author(s):  
Tamas Toth ◽  
Zoltan Sebestyen
Keyword(s):  
Risk Assessment ◽  
Risk Management ◽  
Risk Category ◽  
Project Risk ◽  
Risk Management Process ◽  
Minimum Requirements ◽  
Integrated Project ◽  
Assessment Procedures ◽  
Project Risk Analysis ◽  
Project Risk Assessment

This chapter will provide an instantly applicable integrated project risk analysis method, which tracks the probabilities of the occurrences of harmful events perceived by the owners from the conceptual phase to the end of the project. The chapter follows a threefold structure. First, the paper provides a revised integrated project risk assessment framework that enhances conventional risk category-based methods. Second, the minimum requirements of the owners are clarified to attain the main goal of project risk assessment and to identify the harmful events jeopardizing this goal. Third, the widely known risk assessment procedures are revised, and a methodology for taking and selecting proper risks is provided. Finally, a new valuation approach to the monitoring phase is introduced, which is able to capture the current market value of the project based on the risk management and controlling system's data.

Improving Objectivity in Project Risk Management

2017 ◽  
pp. 248-265
Author(s):  
Kailan Shang
Keyword(s):  
Risk Assessment ◽  
Risk Management ◽  
Expert Knowledge ◽  
Process Mining ◽  
Critical Role ◽  
Project Risk Management ◽  
Project Risk ◽  
Resource Misallocation ◽  
Back Testing ◽  
Subject Matter Expertise

Project risk management requires subject matter expertise to identify and assess relevant and sometimes unique risks. Insufficient experience data and fast evolvement of emerging risks in the field of project risk management make qualitative analysis more prevalent in project risk assessment. Therefore, expert knowledge and experience play a critical role in project risk management. On the other hand, the resulting subjectivity often leads to inconsistent risk assessment. Undesired consequences include cost underestimation, risk underestimation and resource misallocation. This chapter discusses the causes and adverse impact of subjectivity in project risk management and methods to improve objectivity. It covers common human biases in project risk management and introduces measures to improve objectivity in project risk management using expert diversification, risk culture, process mining, fuzzy logic models, and back testing.

Project Risk Management Process for Professionals

2016 ◽  
pp. 128-149 ◽  
Author(s):  
Tamas Toth ◽  
Zoltan Sebestyen
Keyword(s):  
Risk Assessment ◽  
Risk Management ◽  
Risk Category ◽  
Project Risk ◽  
Risk Management Process ◽  
Minimum Requirements ◽  
Integrated Project ◽  
Assessment Procedures ◽  
Project Risk Analysis ◽  
Project Risk Assessment

This chapter will provide an instantly applicable integrated project risk analysis method, which tracks the probabilities of the occurrences of harmful events perceived by the owners from the conceptual phase to the end of the project. The chapter follows a threefold structure. First, the paper provides a revised integrated project risk assessment framework that enhances conventional risk category-based methods. Second, the minimum requirements of the owners are clarified to attain the main goal of project risk assessment and to identify the harmful events jeopardizing this goal. Third, the widely known risk assessment procedures are revised, and a methodology for taking and selecting proper risks is provided. Finally, a new valuation approach to the monitoring phase is introduced, which is able to capture the current market value of the project based on the risk management and controlling system's data.

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