ASSET RISK


The core analysis of ProMS Investor




Using the powerful ProMS engine, this module performs the essential analysis required to determine the risks within an individual asset.

Most property investment models require a number of assumptions about the performance of the property - will tenants leave or stay at lease events, how much will refurbishment cost, how will rents change in the future. These assumptions strongly influence the modelled cash flows and capital growth, to the point where the expected returns are simply a reflection of the initial view.

By using cash-flow simulation, ProMS calculates the expected returns of a commercial property investment in thousands of different economic scenarios, generating a range of possible returns. A key output is the standard deviation of these results - the higher the standard deviation, the higher the risk of the investment.

The analysis incorporates risk at every level:
  • Lease ends
  • Breaks
  • Rent reviews
  • Under/over rented units
  • Tenant defaults
  • Cost inflation
  • Void periods
  • Rental growth
  • Exit yields
  • Tenure
  • Segment


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