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Value Metric

Page history last edited by mrexmiller 2 yrs ago

Economic Model 

  Value Model – the current metric to building valuation is the CAP rate (NOI/sale price). As Bill points out that scorecard measures the wrong thing. Developing a new and SIMPLE valuation model is key to realigning the economic incentives within the value network. Developing a valuation model that compares the true cost and return for an integrated adaptable approach vs. the conventional approach is key to establishing an evidence based case for a new approach. This valuation model will incorporate the emerging triple net concept of economics, sustainability and good citizenship.
  Risk Model – creating a collaborative process requires a new risk model. If participants enter a collaborative framework earlier there is significant opportunity to improve the process and product. At the same time this distributes the control, responsibility and risk.
  C-Level message – crafting a message to end-users and particularly C-Level executives is key to driving change. C-Level executives provide a financial integration point and are uniquely trained to look out for the company’s interest. The complexity and size of real estate transactions requires knowledge and engagement at the C-Level.

 

Thought Leader - Jabir Al-Hilali

 

Stake holder financial incentive 

 


 

Can this process be delivered at the same up front cost as a conventional approach?

 

 

If not, what is the gap and what would have to change to reduce that gap?

 

 

What are the current disincentives in the system to deliver a high-performance building? 

 

 

What changes in legislation could accelerate adopting a High Performance model?

 

 

What is the added cost due to disconnects and disincentives within the current system?

 

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