This course will be delivered in collaboration by Cambridge Finance and Climate Risk Services.
Climate risk is an emerging topic for real estate investors. The Real Estate sector has not yet priced in climate change impacts, creating both opportunity and risk for real estate investors, developers, and operators. The Climate Risk and Commercial Property Valuation course will provide participants with an understanding of what climate risk is, how it drives valuation, and risk modelling tools in Excel to assess how climate change should impact investment strategy and decision-making.
Our approach is assessing the climate risk impact on the long-term value drivers at both the asset level and the market level. For example, at-risk markets will face higher insurance rates; lower rent growth; lower debt availability; and higher property taxes to pay for local adaptation measures. We will explore how climate risk will cause risk premiums to increase in many real estate markets; and, how asset-level valuation factors may be impacted.
Who should attend this course?
- finance directors
- risk managers
- sustainability experts
- investment strategists
We will cover what climate change is, how it is material to the real estate sector, approaches to evaluating climate risk exposure, quantifying climate risk in the financial terms, regulatory responses and disclosure guidelines, how to incorporate climate risk in real estate investment models, and implications for investment strategy and decision-making. The course will be highly interactive with the use of case studies and breakout groups for deeper discussion and learning.
This course is designed to give participants an understanding of how climate change should be factoring into decision-making, at the strategic level, for active risk management, and as part of valuation and investment decisions. Ideal for anyone who carries responsibility for valuation, strategy, risk management, or portfolio management.
- Basic understanding of what climate change is and how it presents risk to the real estate sector
- Understand what market-level climate risk is and how asset-level risk drives valuation
- Learn how to model and analyse climate risk for property investments using sensitivity, scenario analysis and simulations in Microsoft Excel
- Understand regulatory requirements relating to climate risk for Europe, including ECB Guide on Climate-Related and Environmental Risks, the EU Taxonomy, and disclosure requirements
- Understand how to incorporate climate risk into strategy, risk management, and decision-making
Duration:– Virtual Live: 4 days, 9am to 1pm
CPD Hours: 14
Maximum number of delegates: 12
(Payment Plan available)
- 9-12 November 2021
Module 1 – Basic concepts property valuation
by Cambridge Finance
- The concept of valuation
- Valuation steps
- Conventional valuation methods
- Market sentiment
Module 2 – How does climate change affect property valuation
by Climate Risk Services
- What is climate change
- Identifying risk channels
- Understand asset-level climate risk
- Understanding market-level climate risk
Module 3 – Discounted Cashflow Method
by Cambridge Finance
- Setting up the cash flow method using Excel functions
- Present Value (PV), Future Value (FV), and Discounted Cash Flows (DCF)
- Calculation of Exit Value
- Capital Value and returns calculations using Excel functions
Module 4 – Integrating Climate Risk into DCF Model
by Climate Risk Services
- Identifying main risk drivers
- Assign probabilities and damage curves
- Develop Monte Carlo and Bayesian probability distributions of financial impact
- Update Risk Management Framework
About Climate Risk Services
Climate Risk Services (CRS) is a consultancy firm and product developer, founded by Gerhard Mulder and Stephanie Gnissios with offices in Amsterdam (NL) and Oxford (UK). We build climate-smart organisations by helping clients increase their climate resilience. We turn climate data into fit-for-purpose information to help clients understand how to manage climate risk and take advantage of climate opportunities, then support them to embed climate into strategic decision-making and risk management within governance frameworks.
About Gerhard Mulder
Gerhard’s career in climate finance spanned both the public and private sector, having worked in consulting in Washington DC, environmental markets on Wall Street, and for the Dutch government (Netherlands Enterprise Agency), Dutch banks (ABN AMRO and Rabobank) and a leading non-profit (IUCN) in the Netherlands. He studied environmental economics and international affairs at Columbia University in New York, and Public Policy at the University of Amsterdam, before completing an Executive MBA at Said Business School of University of Oxford.
About Stephanie Gnissios
Stephanie is a mechanical engineer and certified project manager, the early stage of her career being in the mining sector as both consultant and owner/operator. Moving from the technical side into project delivery, operational improvement, and through to portfolio management, strategic decision-making, and risk management, Stephanie brings extensive knowledge and experience on project valuation and risk management. With an Executive Masters of Business Administration from the University of Oxford, she blends sector knowledge with business expertise to support companies in tangible steps towards improved risk management and strategy delivery.