A new Appraisal Institute brochure, Menu of Valuation Services Performed by Real Estate Appraisers, is intended to assist appraisers and commercial real estate lenders, including risk officers and managers and chief appraisers, in clarifying and understanding the range of services that can be performed by real estate appraisers in CRE loan workouts.
With $3.5 trillion in commercial real estate debt outstanding, and agency regulations and guidelines being updated, financial institutions are more closely monitoring collateral values during loan workouts, renewals and restructurings.
The Menu describes the different options that can be delivered by real estate appraisers for regulatory compliance, portfolio and loan monitoring and risk management purposes, according to Bill Garber, Appraisal Institute director of government and external relations.
“CRE portfolio monitoring and debt restricting is one of the biggest issues facing our financial system today, and real estate appraisers and strong collateral valuation practices are a central component to virtually every solution,” Garber said.
Two versions of the brochure are available – condensed and enhanced. The enhanced version is geared toward practicing appraisers and cites the applicability of certain services with uniform appraisal standards and agency guidelines. The condensed version is more general and may be more applicable to non-appraisers, but may assist with client outreach and explanation.
Both versions of the brochure are available on a new Web page devoted to distressed commercial real estate, which includes education links, reports and applicable federal agency guidelines on distressed commercial real estate issues. To access the brochures and the appraisal resource page, visit www.appraisalinstitute.org/newsadvocacy/Distressed_CRE.aspx.