The report on the Second All-Ukrainian investment forum "Investments in real estate and construction-2009" managing partner of consulting company "Dialog Classic Artem Novikov stopped on the kinds of risks of investment projects, the importance of risk assessment, market conditions, risk analysis, on risk management and ways to reduce risks.
Risks of investment projects
Risk assessment is carried out in the following areas:
1. Financial risks.
2. Marketing risks.
3. Technological risks.
4. Risks of the project participants.
5. Political risks.
6. Legal risks.
7. Environmental risks.
8. Architectural and construction risks.
9. Specific risks.
10. Force majeure circumstances or force majeure.
? Significant reduction in demand for housing.
? High level of inflation.
? Growth% rates on loans.
? stop lending to projects and mortgages.
? The problems with liquidity in the banking sector.
? The instability of the hryvnia.
? The uncertainties of the construction cost.
? The crisis of confidence to the contractors.
? Political instability.
Risk analysis projects
In international practice the most, the following methods of risk analysis of the project:
I. Sensitivity analysis (sensitivity analysis) - method to identify critical indicators of the project. The analysis verifies the performance criteria of the project (eg, NPV) due to changes in the initial information (the size of investment, price,% rate on the loan, etc.).
II. Scenario analysis (scenario analysis) - the method of analysis of project risks, according to which the baseline scenario compared to the values ??of NPV best and worst situations.
III. Simulation modeling by the Monte-Carlo (Monte-Carlo method) - a technique based on an analysis of the probability distributions of input variables of the model.
Used by most Ukrainian developers strategies to adapt to current market conditions:
? suspension of work on the project;
? offer for sale of projects at various stages of implementation;
? adjusted pricing and sales strategies (reducing prices by 30% -60% discount for paying 100% to 20% of the total cost of apartments for sale housing in installments).
Effective strategies to minimize the risks in current market conditions:
? review the concepts of the projects and repositioning;
? multi-functional projects;
? adjustment promotion strategy;
? Strategic Partnership