Climate change – how to tackle nature’s threat to commercial property

Climate induced threats continue to feature in the news as the impact of increased temperatures and floods become more severe. Although governments have set the wheels in motion to help reach net carbon zero by 2050, there is still a way to go. For example, many businesses in the UK have been affected by floods earlier this year, with commercial property taking a hit as seen in Whaley Bridge where we worked with a commercial lender to undertake a valuable risk assessment exercise following flooding and concerns around the damaged dam.

As well as property damage these scenarios can result in health hazards, reduction in property value, increase in maintenance cost, increased insurance rates and loss of income. The lender we worked with at Whaley Bridge was able to quickly establish the financial risk through the damage or loss of property, as well as the loss of trading that may occur. They were then able to evaluate the potential resultant losses that may occur from this, allowing them to support their clients in a more dynamic way.

This demonstrates how important it is to implement strategies to address potential impact. Environmental risk assessment must play a key role in protecting your property portfolios. You need to understand both the short-term originating and climate-related long-term risk impacts of how soils, flood, and environmental matters impact commercial property. The team at D-Risk can help translate the risks by using a market leading climate change model that uses data enriched intelligence. This allows banks to understand the potential of a commercial property or landscape and strengthen the accuracy of the loan origination process. Employing in-depth risk analysis assists decision making and enhances the security around each asset value into the future.