Intranet

TEGOVA Podcasts

Ground-breaking European valuation topics

Please use the links below to listen to our podcasts via the platform of your choice:

Hosted by Michael MacBrien, Editor of European Valuer

Episode 10 – TEGOVA’s assistance to the State Property Fund of Ukraine in developing a methodology for assessing war damage – Lessons learned from the TEGOVA Chairman’s onsite war zone inspection and meetings with valuers and government

EV interviews Krzysztof Grzesik

  • The scale of the damage and the nature and challenges of any attempt at assessing it
  • The European Valuation Standards Board’s challenge: a methodology for assessing the loss of value to individually damaged properties and businesses in support of compensation claims in Ukrainian and international courts
  • Problem areas
    • Date of valuation
    • Where to draw the line in any compensation claims
    • Articulating war damage assessment with assessing the cost of “Building Back Better” to the European Green Deal’s building energy performance standards

Episode 9 – Valuers need guidance on working with AVMs and European Valuation Standards will provide it

EV interviews Rolph Limpens

  • The EU regulatory background
  • The evolution of the Dutch legislator’s approach to desktop valuation
  • Desktop valuation without inspection and with AVMs
  • Are Dutch valuers equipped to understand all the AVM’s inputs and assumptions as mandated by the European Banking Authority’s Guidelines?Certifying the reliability of the AVM
  • The need for EVS guidance for valuers working with AVMs

Episode 8 – The road to Irish Blue Book valuation – European Valuer interviews Patrick Davitt FIPAV REV, CEO of the Institute of Professional Auctioneers & Valuers (IPAV)

  • The Ireland of the past: Red Book and nothing else
  • The financial and property crisis proved to be the catalyst for the introduction of European Valuation Standards
  • How IPAV supported by TEGOVA persuaded the Central Bank of Ireland to take up EVS
    • The window of opportunity: Transposition of the Mortgage Credit Directive into Irish law
  • The hard slog of getting valuation-commissioning government departments and banks to rewrite their procedures and template valuation reports to accommodate EVS

Episode 7 – TEGOVA’s Valuation Standards and Qualifications – European sovereignty made real

  • From national to European sovereignty
  • TEGOVA’s vision of European sovereignty: standards by and for Europeans, in lock-step with EU law
  • Sovereignty means control, and in TEGOVA it falls to the 72 member associations:
    • For the content of the standards (example of Comparative Method assessing Market Value: “prices obtained from sales” v “other relevant information”)
    • For the REV and TRV qualifications: TEGOVA provides the procedural framework and inspects the Awarding Member Associations, but the rest falls to the members
  • The importance of EU imprimatur: Respect for TEGOVA’s qualifications flows from respect for EVS

Episode 6 – New EU law on rapid deployment of rooftop solar installations

  • Comes in the context of proposals to again raise the EU targets for share of renewables and for reduction of energy consumption
  • Very tight deadlines for installation
  • Types of buildings covered and exempted
  • Comes with further EU legislation limiting the length of permitting procedures for rooftop solar installations
  • The catalyst was war and the need to immediately compensate permanent loss of Russian energy supplies
  • Owners to foot the bill

Episode 5 – For buildings, transformational EU energy law was already unstoppable – War is the accelerant

  • Massive, step-change renovation of the worst-performing building stock in time to meet the 2030 55% GHG emission reduction requirement.
  • An across-the-board renovation obligation for the 15% worst-performing building stock, all building types included.
  • The revolution:  absolute renovation deadlines, regardless of the building renovation cycle.
  • The litmus test: “The exemplary role of public bodies’ buildings”
  • The accelerant sparked by the Russian attack: “Each extra percentage of energy efficiency means 2.6% less gas imports.”.

Episode 4 – The challenge of valuation in Portugal – European Valuer interviews Paulo Barros Trindade REV, President of ASAVAL and Member of the Board of TEGOVA

  • The emergence of new technologies for financial sector valuations is catalysing a transformation of valuers’ practice and skills
  • The future is neither valuer ‘business as usual’, nor stand-alone AVMs
  • The key is training:
    • To enable valuers to expand into new, more complex fields
    • To learn how to work with AVMs
      • With a strong cross-border perspective to pool trainers and diversify training offer

Episode 3, Parts 1 & 2 – Cutting the carbon crap in real estate valuations – Pricing the decarbonisation transition – European Valuer interviews Xavier Jongen, Managing Director of Catella Residential

  • The building energy transition to carbon neutral is handicapped by not pricing the costs of decarbonisation into investment transactions.
  • A profession that works with backward-looking ‘comparables’ is not configured to handle the forward-looking and currently ‘un-benchmarked’ notion of decarbonisation in real estate, so we need a new approach in the valuation framework to bring this onto the profit and loss balance sheet.
  • If property valuers do not move towards including forward-looking decarbonisation costs in their assessments, because this isn’t in the existing valuation standards, they will further disconnect from the direction in which society and lawmakers are moving and may find new rules thrust upon them without significantly influencing their form.
  • Great progress has already been made in EVS 2020 which references the principle: “include forward- looking energy transition costs into your valuation”. But if the principle is there, how do you execute?
  • Catella’s approach to pricing its investment in decarbonisation
  • We need to start thinking about technology and including it in our financial projections.
  • How difficult would it be to propose to each client an ‘Environmental Valuation’ alongside the Market Value valuation — adding say 10% to the fee?
  • Material data are currently scattered in different unconnected formats in a plethora of organisations. Vital data for our ‘common good’ contained in organisational or personal ‘silos’ should be pooled and become collective intelligence.

Episode 2 – Assessing the value at risk in the energy performance of European buildings – European Valuer interviews Peter Sweatman, Chief Executive of Climate Strategy

  • EVS 2020 requires valuers to be aware of any legal renovation deadlines or inflection points (e.g., rental, sale) estimate the cost of the renovation and its impact on value, but the Blue Book still has more conservative approaches to valuing ‘green premiums’ and ‘brown discounts’.
  • Is value simply being redistributed between energy efficient buildings and inefficient ones in a zero-sum game? Is the sum of all green premiums equal to the sum of brown discounts, or is the overall market value of all European buildings increasing, or decreasing, due to energy efficiency improvements and lower bills?
  • A powerful way to answer this question is to see if the aggregate value of the cost savings resulting from building renovations is greater than the aggregate cost of those renovations.
  • If two-thirds of the buildings’ energy bill is allocated to Europe’s 220 million households, the break-even energy renovation budget to upgrade these 220 million European homes is €13.2 trillion, or €60,000 per home.
  • Sustainability, energy efficiency and green features should indeed only be reflected in a building’s valuation where there is observable market evidence. Yet markets are fickle and the impacts of property features vary over time, and between different sectors, cities and regions. Nevertheless, with a present value of up to €20 trillion of future energy savings at play in moving to net-zero energy buildings, a €3 trillion renovation wave investment by 2030 will surely provide the evidence that valuers need to reflect efficiency premiums or discounts in the next edition of EVS.

Episode 1 part 2 – Valuation practice had better follow

  • For real estate markets, it looks like the term ‘stranded assets’ is going to get new currency.
  • For valuers, it means there will be no time for a gentle shift via small market value premiums for ‘green assets’ and small discounts for ‘brown’ ones.
  • There’ll need to be a rapid change of valuation focus. EVS 2020 made a brave start at addressing that; EVS Standard 6 ‘Valuation and Energy Efficiency’ is spot on.
  • But EVS 6 only tells valuers what they must do, not how to do it, how to integrate energy efficiency valuation into their determination of Market Value.
  • Guidance, education and training need to follow.

Episode 1 part 1 – EU climate law will transform real estate

  • 20 years of EU climate regulation and GHG emissions reduction targets have come up short, but the European Green Deal’s ‘Fit for 55’ legislative package and the new targets in the European Climate Law change everything.
  • It’s political dynamite, with owners and occupiers doubly hit by higher renovation requirements and energy bills.
  • As ‘Fit for 55’ regulates the whole economy, there’s no wiggle room to shift the burden from real estate to other sectors.
  • The ‘hit’ for real estate will be even bigger than the ‘55% GHG reduction suggests.