M&G Real Estate, UK portfolio

We are M&G Real Estate’s sole provider on their framework for Reinstatement Cost Assessments across their UK portfolio of properties. We undertake an annual reassessment of a proportion of their portfolio, together with all new acquisitions throughout the year. We have also provided assessments for numerous European acquisitions.

M&G's cross-sector portfolio has a significant industrial element, including many multi-let industrial estates, large distribution units and data centers across the UK. All portfolio properties are approached in the same way to ensure consistency and accuracy.

Our dedicated team work closely with the insurance team, development managers and property managers to ensure the smooth running of the framework. We meet regularly, initially to finalise the pre-inspection information and agree those properties to be included in each year’s portfolio, and then on a regular basis to review the assessments undertaken to identify any discrepancies in the Declared Values with previous assessments and/or the apportionment between units. We are responsive to the need for ad-hoc assessments on new acquisitions and developments and work closely with those undertaking the technical due diligence to make sure there are no delays. Such assessments are completed within 10 working days of instruction in accordance with the framework KPIs.

Here's an insight into our approach:

During our inspections we ascertain the gross internal area and establish the construction of the property elementally. We then adopt an elemental approach for each different type of construction to establish the most accurate re-building rate for the property. We steer away from the use of average prices in order to provide the most accurate rebuilding cost for the property – rather than a generic rate for properties of a similar type. While not initially a requirement of the framework, the merits of this approach were discussed and adoption agreed to ensure consistency across the portfolio. We highlight any tenant’s fixtures that we have included or excluded where this differs from the agreed schedule of tenant’s fixtures and fittings – this is particularly important as it is often the cause of tenant disputes, resulting in delays recovering premiums.

We ensure consistency in our report format using a firm-wide template system, and we developed a framework specific template to incorporate additional information that was useful for their internal audit systems. We use rigid QA procedures ensuring all reports are reviewed by a senior member of our team of experienced Building and Quantity Surveyors. 

We prepare a unit-by-unit breakdown of the reinstatement cost. These apportionments take account of the landlord’s insurance obligations for each unit and are used to calculate the premium due for each tenant. 

We also provide a consultancy service whereby property managers can make enquires as to whether new assessments are required following alterations made to the property either by the landlord or tenant. We undertake desktop assessments based on the information provided and by doing so ensure that the Declared Value is updated. We prepare desktop inflationary updates for certain larger value properties each year even though they are not being reassessed that year.

Ultimately, our consistent, detail-led approach and responsive partnership ensure M&G Real Estate can rely on accurate, timely reinstatement cost assessments that support effective insurance management across their evolving portfolio.