The Management of Risk in UK Office Property development

Peter Fisher and Simon Robson

ERES from European Real Estate Society (ERES)

Abstract: Risk is an ever-present aspect of business, and risk taking is necessary for financial success and economic progress. To be successful, a business must consciously manage risk, accepting appropriate and well-judged risks and rejecting others. Rational decision makers should identify the sources of potential risks, classify their potential impacts, analyse the consequences of an impact and its probability of occurrence and apply their ërisk attitude. Speculative property development is popularly perceived as a ërisky businessí yet, like other entrepreneurs, a developer has opportunities to manage the risks it chooses to carry. These include pre-letting, phasing and joint- ventures. This paper reports the results of a survey of UK office development projects. The survey was carried out by a postal questionnaire of developers responsible for 200 office development projects across the UK. Respondents were asked about their perceptions of risk before and during their projects and the risk management techniques they had adopted. In depth interviews with office developers were then used to discuss the survey results and uncover the underlying processes.

JEL-codes: R3 (search for similar items in EconPapers)
Date: 2004-06-01
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Persistent link: https://EconPapers.repec.org/RePEc:arz:wpaper:eres2004_138

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