What do you specialize in and what are the best circumstances that clients/prospects should come to you for help?
Throughout my time at Suncorp, I have had the opportunity to experience and work on a large variety of assignments, from standard industrial appraisals, to multi-family, office, retail, agricultural and development land, as well as appraisals for a number of special use properties. However, appraisal work specific to expropriation, going concern valuations on recreational properties, or real estate in secondary markets, are areas I specialize in.
Please describe an interesting project you worked on recently.
I recently worked on an assignment of an RV Park which has been heavily impacted by both COVID and the downturn in the oil and gas industry in its respective area. There were several moving parts to consider, both in terms of the property itself, and the changing market conditions.
What do you enjoy doing when you’re not working?
I enjoy gardening, paddle boarding, hiking and going out quadding and snowmobiling with my family; really anything outdoors, and I love travelling.
Many factors influence building costs. These factors fall under the general categories of material costs, services costs, and labour costs.
Looking at material costs, there are many sub-categories such as framing lumber, concrete, steel, gyproc, insulation, etc. Each of these sub-categories are impacted by supply and demand forces in their particular market which ultimately influences the cost for that item.
Looking at framing lumber, these costs have risen significantly during the past year mainly due to a rapid rise in housing starts. On the other hand, labour costs have flattened or in some cases fallen with some sub-trades and in some regions during the past year due to mass layoffs and high unemployment caused by the COVID pandemic.
Although there are innumerable factors that influence building costs, during the last ten years the overall trend has been inflationary.
During the first year of the pandemic, there has been a great deal of volatility, but the overall trend has been inflationary as well.
According to Stats Canada, Canadian residential construction costs increased by 12% between Q1 2020 and Q1 2021.
We have observed in some cases that although building material costs have recently risen significantly, some developers are decreasing profit margins or taking some other steps to lessen the inflationary impact.
As an example, statistical data indicates that overall building costs in the Vancouver region rose 3.7% from Q4-2019 to Q4-2020, and that during the same period the cost of single family housing rose 6.6%.
What is the current outlook for building cost trends for 2021 and 2022?
This short-term rate of building cost inflation is unsustainable. Therefore, at some point in 2021 or 2022 the pace of increase should slow to levels that are more traditional. There may even be a period of deflation to some degree as the markets re-adjust. However, with so many different factors at play it is impossible to predict the nature and timing of this change in trends.
How does this affect Insurance Appraisals?
During normal business cycles, Suncorp’s professional staff monitor a wide variety of data sources to support building cost estimates for a wide variety of building types, and in a wide variety of locations. This includes analysis of statistical data from Stats Canada, RS Means, Marshall & Swift, and many other reliable sources. We also collect and analyze market data in the form of actual costs from current construction projects.
During times of economic instability, such as the COVID pandemic, market forces become volatile. This volatility affects the many factors that influence building costs. As such, it becomes challenging to accurately estimate building costs during these periods. For example, statistical reports often have a 3-6 month lag time. Accordingly, the recommendation by many brokers is to have a professional appraisal done at regular intervals so long term market factors such as economic and even monetary factors (exchange rates) are considered to arrive at an accurate value.
Have you ever considered getting a second opinion on an appraisal, cost estimate report, reserve fund study / depreciation report, or consulting report? Here is an option, the Technical Review. You can even get a Technical Review of a Technical Review.
What is a Technical Review?
A Technical Review is an unbiased and objective formal written critique of a report that was prepared by another firm.
The purpose of a Technical Review is to form an opinion on if a subject report is credible and reliable. The opinion is supported in the Technical Review report by detailed analysis of any errors or deficiencies observed in the subject report.
Technical Reviews are prepared by Suncorp’s Senior Consultants whom have completed additional training and have experience in this specialization. Technical Reviews prepared by Suncorp are prepared in alignment with the Review Standards of either the Uniform Standards of Professional Appraisal Practice (USPAP), or the Canadian Uniform Standards of Professional Appraisal Practice (CUSPAP).
What are Technical Reviews used for?
Technical Reviews are most often prepared for different types of litigation support, and at various stages including pre-claim analysis, or to assist with preparation for cross examination.
Technical Reviews are also often commissioned as part of a due diligence process. For example, a private equity lender may require a Technical Review of an appraisal report to help determine the credibility and reliability of an appraisal submitted as part of a mortgage application.
Scope of a Technical Review
The scope of a Technical Review has a very wide range, from a basic standards compliancy up to a full audit of work-files.
All Technical Reviews include a standards compliancy review against the set of standards under which the subject report was prepared, which could be either USPAP, CUSPAP, RICS Red Book, International Valuation Standards, etc. This stage also includes a review of methodology employed within the subject report.
Technical Reviews may also include additional steps depending on our clients need. These can include verification of factual data reported within the Subject Report, re-inspection of the subject property, additional market research, or even a full audit of the entire process and work-file. Often our clients may have specific questions or issues they may want us to investigate.
It is important to note that a Technical Review does not provide an alternate opinion. For example if the subject report is an appraisal report, the Technical Review does not include an alternate opinion of value. However if the client also needs that alternate opinion of value, Suncorp is available to provide that service under separate cover.
Geographical Considerations
Depending on the scope, Technical Reviews may be conducted on reports developed on properties located virtually anywhere.
For example if the subject report is a Reserve Fund Study on a property located in, say Texas, and the scope of review is limited to a standards and methodology review, then the location of Suncorp’s reviewer is not an issue.
Suncorp’s Technical Reviews Services
Suncorp Valuations can provide Technical Review services on a wide variety of report types including Real Property Appraisals, Machinery & Equipment Appraisals, Insurance Appraisals, Reserve Fund Studies and Depreciation Reports, and related Consulting Reports.
Learning Objective: To discuss the recommended inspection practices for Playgrounds after winter conditions.
The requirements/recommended practices for inspections of playgrounds follows CSA Z614 “Children’s Playspaces and Equipment Standards”. Compliance with this CSA standard will help to reduce injuries on playground equipment. This document will discuss the recommended practices for Playground Inspections before opening in the spring.
Design & Operation
All Playgrounds should be installed according to the most current CSA standard.
A “third party” detailed Playground Safety Audit should be in place on all equipment.
Standard impact protection, sand, pea gravel, wood chips, rubber, etc. should be maintained at all times.
Damaged equipment should be repaired or removed from play immediately to help prevent injury.
Spring Time Inspection
Have any changes taken place to the equipment over winter that could affect the integrity of the playground structures.
Is all playground equipment in good condition with no damage or missing pieces?
Is all impact protection materials maintained to appropriate depths to help minimize exposure to injury (Tilling or top up may be required after winter snow pack)?
Check to make sure all standing water is drained as quickly as possible or device cordoned off until such time as this water can be drained.
If needed, Cordon off equipment from use should repairs, standing water, or other damage be evident.
Is appropriate signage provided and visible alerting patrons to current conditions?
Regular Inspection/Maintenance Schedule
Daily/weekly: Visual inspection for broken glass, vandalism, animal droppings, damaged equipment, etc. Replenish or rake ground cover. This inspection should be conducted before students arrive in the morning (if a school) and can be performed by any staff member or a custodian. The inspection and any corrective action should be logged in a daily journal. (Appropriate maintenance department staff should be notified immediately if any concerns are noted. Have process in place, work order or communications system, documented inspections and follow up.)
Monthly:This is a more detailed inspection and must be recorded on an appropriate equipment checklist form. This inspection should be conducted by a certified inspector. Any maintenance or repairs noted on the checklist should be acted upon immediately, and recorded when completed.
Annually:This is a comprehensive audit of the playground site that should be conducted by a certified playground inspector. Contact your applicable department office or ourselves if needed. Annual Audits should be provided as per current CSA standards.
Suncorp Valuation’s Rick Dettmann was invited to speak on the Every-DayRisk Podcast.
Below, you can listen to the podcast in full.
In this episode there is an in-depth discussion with experts on the pros and cons of different types of property valuations and when to use them. Specifically, about property and equipment valuations. The hardening market has increased the importance of accuracy when creating these values, and our thoughts and conversations that we have on these values really have changed.
From New York City to Krakow to Montreal. From Vancouver to Los Angeles, to Windhoek. From Lima to Perth to Jakarta and all points in between. It has been a very challenging year (to say the least) and we have been very pleased to work with you, our valued clients, on appraisal and risk management engagements all over the world in 2020. We are truly blessed to be working with every single one of you! We want to wish you a very safe Holiday Season and wish you all good health and success in 2021.
In lieu of Christmas cards Suncorp Valuations is pleased to contribute to various local charities in each of our office locations.
Design & Operation
Spring Time Inspection
