Foreign Real Estate Project Risk Management Research

The chinese real estate industry has obtained a fast growth since the housing system reform and opening, as a pillar industry for the national economy. With the improved investment environment and huge attractiveness, some foreign capitals are penetrating into the chinese real estate industry through various kinds of investments. Bringing advanced concepts and management models, the penetration by foreign capitals have prompted domestic developers to cut cost and promote quality by using cutting-edge technologies and equipment, as well as innovating operating schemes and management philosophies. In the meantime, the investment by foreign capitals in the chinese real estate market remains in the pilot stage. The foreign market players also have to face risks in terms of inadequate information transparency, unclear policies, weak interpersonal connection, and unfamiliarity with local conditions etc. They should conduct accurate qualitative and quantitative analyses regarding possible risks that may occur while investing in a chinese real estate project. And they need to adopt scientific and effective measures to strengthen risk management.First, the thesis gives an introduction to the basic concepts and theories of risk management for a real estate project, such as risk management organization and process, and defines the goals, objects, content, methods, and significances of this research. Second, based on the understandings to the status quo, strengths and weaknesses of foreign developers, the thesis makes an analysis on the risks in an entire investment process. The sources of main risks are further verified through risk recognitions for4phases:investment decision-making, land acquisition, construction, and management on property lease and sales. Thus a risk assessment index system for an entire project takes form, consisting of indexes at target layer, criteria layer, and index layer. A full set of risk assessment index system is established for a foreign investment project via case studies. Through a quantitative analysis from an analytic hierarchy process, the weights of these indexes are calculated. These weights show the degrees of risky factors’influence to a project. At last, the thesis puts forward the measures and suggestions for risk management on real estate projects.