Technical Competencies - Level 3 Qs Flashcards
How have you illustrated multi-tiered financing arrangements numerically and used this to assess the true cost of finance at each level?
As part of my day to day I am not responsible for assessing the true cost of finance at different levels of specific financing arrangements. However, when underwriting new investment opportunities, I liaise with my Finance Director on available capacity and therefore review the total financing costs for the different sources of financing as well as establishing the total equity commitment required. I am aware that the true cost of finance also needs to factor in associated fees and opportunity cost if calculating equity finance. I am aware of the CAPM pricing model where market risk is known and I can therefore calculate what the cost of equity will be.
How have you provided reasoned advice on maximising the viability of a funding situation?
I’ve advised on utilising equity financing first when in an uncertain market for a large development project. We can then look to refinance once yields and SONIA swap rates stabilise and therefore we should see a reduction in our interest expense maximising the viability of the opportunity.
How have you provided reasoned advice on maximising the viability of a funding situation?
I regularly review investment opportunities and therefore assess funding requirements which I can provide analysis on to present to my Finance Director who is responsible for drawing down funds.
How have you demonstrated your appreciation of the impact of property matters on valuation and funding?
In summary, property matters such as market conditions, property characteristics, legal and regulatory factors, and income potential significantly influence property valuations and funding decisions. Accurate property valuations are essential for informing funding decisions, assessing risk, determining loan terms, and optimizing financing structures. I regularly assess site characteristics to derive a yield assumption for my underwrite as well as assessing the BOE base rate changes as this can have a massive impact on funding matters.
How have you demonstrated your understanding of the impact of funding matters on the property market?
Funding matters have a significant impact on property. Interest rates have an indirect correlation with property investment given a lot of properties are financed with debt. As the cost of debt increases demand decreases which tends to have a negative impact on the capital value of property. Also, it reduces investor appetite which also has an impact on valuation yields, subsequently impacting the value of the property.
How have you analysed stand alone financing from the outset to drawdown of funds
Although I am not responsible for sourcing debt financing, I am responsible for managing and originating a pipeline of assets which feeds into funding requirements and debt financing objectives.
Can you give me an example of when you have offered reasoned advice following the outcome of an inspection?
I advised not to pursue an acquisition in North London as after conducting a desktop review of the location and deeming it satisfactory, I noticed when conduting a site inspection there were two silos visible from site that could deter prospective tenants. I tried to see if we could alter the mix and take different plots however this impacted viability. Therefore, I reported my findings back to the client and advised we pursue no further.
When going out on an inspection, what procedures do you follow to inform the office of where you are?
I keep my diary updated, showing where I am going and who I am meeting. I always take a mobile phone and check in with a nominated colleague once I leave site.
Adhering to the guidance of Surveying Safely 2nd Edition (2019)
If you were going into an unoccupied building where asbestos may be present – what may you need to
look out for?
Asbestos may be within anything. I would look out for signs or stickers indicating that asbestos may be
present. I would also ask for any reports relating to the property such as Asbestos Reports. I would make
reference to these reports within my report.
What due diligence do you carry out prior to an inspection?
Research: EPC, flood, council tax, planning, location, amenities nearby
Appointment prep: how to get there, parking, weather, access firm up arrangements and contact details.
Prepare items to take: site notes, floor plans, camera, battery pack, disto and protimeter and spare batteries, pen and paper, charged mobile phone, PPE (if required).
Which areas of the Red Book relate to inspections?
VPS 2 and VPGA 8
How have you adopted the recommendations contained within the RICS Surveying Safely in your work?
Risk assessment prior to inspection.
Dynamic risk assessment on the day of.
Checked in with occupier on arrival, and on leaving.
What legislation and RICS guidance is there for asbestos?
Health and Safety at Work Act 1974
Control of Asbestos Regs 2012
HSE Codes of Practice
RICS Guidance Note: Asbestos: legal requirements and best practice for property professionals and clients UK 4th edition, May 2021
What is the process for carrying out an inspection?
Consider my personal safety, and those for whom I have a duty of care
Inspect the local area
Inspect the property externally
Inspect the property internally
What are the differences between an inherent, a patent and a latent defect? NEED TO FIND EXAMPLES
Inherent - always been present, a defect in the design or construction of the building, e.g. misplaced reinforcement.
Patent - a defect that could have reasonably been identified on an inspection, e.g. rising damp.
Latent - a defect that could not have reasonably been identified on an inspection; e.g. problems with the foundations that may not show signs for several years
