THAI REAL ESTATE PRACTITIONERS PERCEPTION OF RISKS Sukulpat Khumpaisal Faculty of Architecture and Planning Thammasat University Bangkok,

Thailand Raymond Abdulai School of the Built Environment Liverpool John Moores University Byrom Street, Liverpool, L3 3AF, United Kingdom Email: R.Abdulai@ljmu.ac.uk Andrew Ross School of the Built Environment Liverpool John Moores University Byrom Street, Liverpool, L3 3AF, United Kingdom ABSTRACT Risk plays a critical role in any investment decision process and therefore its importance cannot be overemphasised. This paper examines Thai real estate practitioners perception of risks caused by social, technological, environmental, economic and political (STEEP) factors and the current risk assessment techniques in the real estate industry. The quantitative research approach is adopted and specifically, parametric or correlative tests have been carried out. It is based on a pilot survey of 50 Thai real estate practitioners, which was conducted in mid 2009 with a response rate of 78% (39 out of 50). It has been established that Thai practitioners are concerned with the risks caused by economic and political factors more than other sources of risk. The study also shows that there is less evidence of the application of systematic risk assessment techniques that help to deal with potential risks. In terms of policy implications, the findings have underscored the need for an appropriate risk assessment model to be developed and implemented in the Thai real estate industry. INTRODUCTION Risks are normally associated with every investment vehicle and therefore real estate development is not an exception. Real estate development has its own risks, especially in relation to the decisionmaking process for a new development project. The entire project management process regarding schedule delay, cost overrun and quality of products are affected by risks (Gehner et al., 2006; Khallafalah, 2002; Flyvbjerg et al., 2003; PMBOK, 2002). In terms of the nature of real estate development projects, risks can only be managed within an overall framework of risk management processes (Blundell et al., 2007; Booth et al., 2002). It is important for risk assessment techniques to be based on preferably rigorous quantitative statistical framework as well as subjective analyses of issues.

Broadly, risks are categorised into systematic and unsystematic and there are various techniques that can be used to assess risk be it systematic or unsystematic. These techniques include Project Risk Ranking (PRR) and the Construction Risk Management System (CRMS) (Baccarini and Archer, 2001; Al-Bahar and Crandall, 1990). These techniques have, however, been developed based on certain parameters. Thus, a technique that might be applicable in one country and have the desired impact may not be applicable in another country owing to differences in the business environments. Most of the techniques are also subjective in nature, as they are not based on quantitative statistical measures (Choi et al., 2004). There is therefore a need for risk assessment techniques that are based on a rigorous and quantitative statistical framework. Using Thailand as a case study, the objectives of this paper are to: (i) investigate the possible causes of risks in real estate development projects as well as assess the current risk assessment techniques employed by Thai real estate developers; and (ii) explore any differences in perceptions between Thai real estate practitioners and the Western world. The choice of Thailand as a case study is based on the fact that it was the starting point of the global economic crisis in 1997 (Hilbers et al., 2001; Warr, 2000). The behaviour of players in the real estate sector towards risks is often cited as the primary factor responsible for such economic crises. Quigley (2001) and Lauridsen (1998) argue that the players did not pay enough attention to the impact of risks on their businesses because they did not have the appropriate techniques that could be used to assess risks and deal with the impact. In recent years, the current global economic recession has also had significant effects on the entire Thai business sector. However, it appears that Thai real estate developers are still unaware of appropriate risk assessment techniques that can be used to potently deal with risks in the changing business environment (Kritayanavaj, 2007; Pornchokchai, 2007). To intimate what follows, the next section looks at the general classification of risks which is followed by a section that provides background information of the Thailand real estate development sector. In section four, the research methodology adopted for the study is described. A comparison of Thai and Westerns perceptions of risks is made in section five. The empirical data collected is presented and analysed in the penultimate section whilst the last section concludes the paper. INVESTMENT RISK AND ITS MANAGEMENT PROCESS Risk is a concept that denotes a potential negative impact on an asset, project or some characteristic of value that may arise from some current process or future event (Crossland et al., 1992). According to Baum and Crosby (2008 risk is the uncertainty of an expected rate of return from an investment, while Hargitay and Yu (1993) define risk as the unpredictability of the financial consequences of actions and decisions. Similarly, risk is the extent to which the actual outcome of an action or decision may diverge from the expected outcome (Huffman, 2002). Thus, risk is simply the probability that an investor will not receive the expected return or the deviation of realisations from expectations. Risks can be broadly classified into systematic risks and unsystematic risks. Systematic risk (uncontrollable risk) is the type of risk caused by external factors that affect all investments examples include market risk, inflation or purchasing power risk, and interest rate risk (Baum and Crosby, 2008; Brown and Matysiak, 2000). According to these authors, unsystematic or specific risk refers to risk over which the investor has limited control. Thus, unsystematic risks affect only a

specific or particular investment. Unlike systematic risk, the investor has a limited control over his exposure to unsystematic risks; he can investigate companies in which he is going to invest and can make decisions on the basis of the track record and prospects of the companies and their management. Examples of specific risks include liquidity, business, financial, sector and taxation risks. Risks can also be classified according to the perceptions of decision makers. In this regard, risks are described as multidimensional, with a particular meaning to different people and different things in different contexts (Crossland et al., 1992). Pidgeon et al. (1992) classify risk into objective or statistical risk and subjective or perceived risk. By this classification, objective risk is unique, substantive and physically measurable, and can be determined by quantitative risk assessment techniques. Subjective risk is what an individual perceives to be a possible unwanted event; the degree of subjective risk depends on peoples experience of their history and the expectation of its occurrence (Spaulding, 2008). Subjective risk also involves subjective probability or the perception of the decision maker of the likelihood and consequence of the event. In relation to real estate development especially, there are risks that emanate from social, technological, environmental, economic and political (STEEP) factors (Morrison, 2007) and these factors are often of concern to developers during the project feasibility analysis stage (Thompson, 2005; Matson, 2000; Millington, 2000). The STEEP factors have been widely used in the business context, but with different names, such as PEST, TESP and STEP. According to Nezhad and Kathawala (1990), the classification of risks into STEEP factors is pragmatic as well as simple and clearly understood by all project participants. It is this classification of risks into STEEP factors that this article is concerned with. As indicated earlier, risks affect real estate project development processes in terms of schedule delay, cost overrun and quality of products. They also affect the progress of projects at all stages of their lifecycles. In the Dutch real estate sector, most developers consider project risks to be caused by several subjective factors such as policy change, and social or community objections (Gehner et al., 2006). Such factors delay the projects progress with many indirect consequences that lead to delays in completion dates, the marketing process and the project revenue in the following manner: decrease in rental / sale price, decrease in velocity of sales, cause a higher vacancy rate and lower investment value (Gehner et al., 2006). Regarding risk management, Frodsham (2007) and Booth et al. (2002) have observed that the idealistic risk assessment model that could analyse the impacts of risks in a numerical format needs to be introduced in the real estate sector. Such a model it is argued would insure that there is a synthesis of risk assessment criterion and also comparisons of each factor can be made in order to help developers to structure the decision- making process. Every risk management process is normally an ongoing and iterative process and each project is different and unique (Khallafalah, 2002). The purpose of risk management is to provide information to the project manager/decision maker to make a better decision at any time during project life cycle with the respect to the project itself (Smith, 2002). Risk management is typically a combination of three basic major steps as identified by Raftery (1994) that are explained below. Risk Identification and Initial Assessment The main purpose of this is to define and categorise the risk associated within the project. For example, categories may include organisation risks, operational risks, project risks and system risks

(Luu, 2008; Khallafalah, 2002). According to Morrison, (2007) regular risks that occur during any development process can be classified into STEEP factors identified above. The other way to identify risks is to categorize them in terms of risks external to the project and those that are internal. The next step after all risks have been identified is initial assessment and the aim is to assess all consequences for risks that would finally affect the developed project. Tasmanian Government (2006) has identified the consequences of risks to be: delayed or reduced project outcomes; reduced project output quality; extension of timeframes; and increased costs. Smith (2002) has noted that the risk identification process enables project managers to identify risks. This process is combined with historical project, industrial checklists and workshop brainstorming sessions. He recommends that the brainstorming sessions are the appropriate methods because of they provide the most updated information, which suit real project conditions, and also equivalent to the value management approach. Raftery (1994) supports the use of brainstorming techniques to identify project risks as he considers them to be effective. The decision-makers need to work closely with the project team in order to deal with the internal risks effectively. They also need to consider the client, the project, the project team and the quality of the documentation from the perspectives of the various contractors in anticipation of claims. The outcomes of the identification process are generally the lists of potential sources of risks, which are classified based on the impact and likelihood of occurrences (Smith, 2002). According to Jutte (2009) the risk assessment step is critical in the whole risk management process; it particularly essential for the decision makers to use the assessment results as information to support further decision making towards risks. He notes that the earlier the decision makers can identify and assess risks, the better as it ensures that les time is spent to respond to risks. Judgements have to be made regarding the positive or negative impact of any risks on the project as well as opportunities and threats, which may occur during the project progress. However, the most important rules are to prioritise and analyse risks. This means that decision makers have to use the information from the risk identification process and the judgements of experts to rank and level the degree of each projects risks (ACT, 2004; Smith, 2002). This process also includes the setting of highest impact risk as the first priority in order to respond or mitigate its consequences. Thus, the risk assessment stage identifies risks as well as assesses the probability of their occurrence and the consequence of the risks (Wrona, 2009). Risk Analysis MacDonald et al. (2004) has defined risk analysis or assessment as a systematic process of identifying potential hazards where there is the likelihood that those hazards will cause harm. The authors note that this process is an important portion of the entire risk management process. According to Raftery (1994) project risks caused by internal and external factors require systematic, experienced and creative analysis. Thus, risk assessment is a controllable device that deals with identified risks and an assessment of their impacts. Generally, risks are analysed in terms of their likelihood of occurrence and consequences. Decision makers may develop a Risk Matrix to assist in the determination of the level of likelihood of occurrence and consequences as well as the current risk level (ACT, 2004). Byrne (1996) observes that this stage of risk analysis is a combination of three aspects which are: measurement or assessment of probability; use of any indicator to measure the individual attitudes to risk; and sensitivity and simulation. Various tools and instruments have been developed to deal with this stage of risk analysis (whether systematic and unsystematic risk

analysis) and such tools enable decision-makers to use information from sources like secondary information or panel discussion (Khumpaisal, 2007; Chadborn, 1999). Response and Mitigation It is really important to identify mitigation strategies very early in any project and this is because practical risk mitigation strategies reduce the chance that a risk will be occur and/or reduce the severity of the risk if it occurs (Byrne, 1996). From the above three stages, the risk management process is crucial since it allows for the determination of quantitative or qualitative values of risk related to a concrete situation and any recognized threat or hazard. The figure below shows the management flow chart

Figure 1: Risk Management Flowchart Source: AS/NZS 4360: 2004 Risk Management Standard (ACT 2004) According to the risk management flowchart above, the first thing to do is to establish a framework for risks by decision makers and based on this, risks are identified. The decision makers have to analyse risks to determine the existing controls as well as determine the likelihoods and consequences of the risks that may occur during the project development process (Byrne, 1996). Thus, it is necessary for decision makers to rank the level of risk based their probability of occurring and their consequences. Risks and then assessed based on comparison of risks against the established criteria and risk criteria are constructed based on the classification of risks. The categories of risks are varied in accordance with the perception of the decision makers or by the current project situation (Pidgeon, 1992).

Another popular risk management or assessment model used by real estate developers is Risk Assessment Matrix (RAM). The RAM describes the likelihood and consequence of each risk in a matrix format that is generally accepted by many decision makers owing to its simplicity and the fact that it provides more understanding of projects at every level (Younes and Kett, 2007; Rafele et al., 2005; ioMosaic, 2002; Kindinger, 2002). However, RAM demerits. One disadvantage relates to the data used in the calculation; the data is based on personal opinions and not on reliable sources with a strong theoretical basis. RAM also measures the likelihood and consequences of risk based on a single criterion, and it is therefore not suited to real estate developers aiming to understand the correlation and the effects of each factor (Chen and Khumpaisal, 2008). Booth et al. (2002) and Frodsham (2007) note that there is a need for an idealistic risk assessment model that can analyse the impact of risks in a quantitative format to be introduced in the real estate sector. According to the authors, such a model would allow the synthesis of risk assessment criteria and comparisons among factors, and would also help developers to structure the decision-making process. It is against this background that the Analytic Network Process (ANP) model has been introduced as an alternative risk assessment technique to respond to these requirements. The model adopts the principles of Multi Criteria Decision Making (MCDM) and it is developed based on the grounded theories of Analytic Hierarchy Process (AHP). The ANP model is a powerful and flexible decisionmaking tool that helps investors or decision makers to set priorities and make the best decision when both qualitative and quantitative aspects of a decision need to be considered (Saaty, 2005; Cheng and Li, 2004). Chen et al. (2006), Saaty (2005) and Cheng et al. (2005) summarise the construction of the ANP model as follows: Decomposing the problem into a hierarchy in which the highest level of the structure denotes the primary goal of the problem and the lowest level refers to the alternatives; Inviting experts to conduct pair-wise comparisons of each element with regard to their respective adjacent higher level. The scale of interval employed in this pair-wise comparison is usually the 9-point scale of measurement; Calculating the relative importance weights (eigenvectors) in each pair-wise comparison matrix and computing the consistency of the comparison matrices; Placing the resulting relative importance weights (eigenvectors) in pair-wise comparison matrices within the super-matrix (un-weighted); conducting pair-wise comparisons on the clusters; weighting the un-weighted super-matrix, by the corresponding priorities of the clusters, which becomes the weighted super-matrix; and Adjusting the values in the super-matrix so that it can achieve column stochasticity. This means that the decision maker will take the resultant relative importance weights (eigenvectors) and place them in the matrix. The model has been used in several areas of construction research and practice since the late 1970s, including construction planning, location selection and environmental impact assessment (Chen et al., 2005; Cheng et al., 2005). Recently, Chen and Khumpaisal (2008) used the ANP model to assess risks in Liverpool commercial real estate projects and the study shows that the ANP model is an effective model to assess risks.

AN OVERVIEW OF THAILANDS REAL ESTATE DEVELOPMENT The collapse of the global economic crisis in 1997 was caused by the downfall of Thailands real estate development business (Warr, 2000). Quigley (2001) and Lauridsen (1998) have observed that the key reasons for this crisis could be traced to financial institutions and real estate developers who it is argued lacked monetary discipline and neglected risks in real estate business as well as the lack of practical risk assessment and management techniques to resolve the consequences of risks. Vanichvatana (2007) and Kritayanavaj (2007) have predicted that the future trend of the Thai real estate sector will be similar to the circumstances in the 1997 crisis, as practical risk assessment techniques are yet to be developed. This prediction is supported by the incidents of the current global recession (2007 2010) and the US sub-prime crisis, which has significantly affected the Thai real estate sector owing to the shortage of housing purchasing demand and less funding injected into the housing and residential sub-sector. Despite the fact that Thai real estate developers have experienced this crisis and acknowledged its main causes, they are still less concerned with risks and their effects on real estate projects. Pornchokchai (2007) and Kritayanavaj (2007) note that this is because of the lack of appropriate knowledge to assess, identify and understand the risks as well as the fact that they are only interested in realising a maximum return from their investment. This article focuses on the real estate development projects in the Bangkok Metropolitan Area (BMA) and vicinity (see Figure 2). This is the heart of the Thai economic and political system, with the highest density of housing projects in comparison to the rest of Thailand (REIC, 2009; ONESDB, 2007). This area also has the highest number of real estate developers approximately 250 (APTU, 2008). Pathumtani Nontaburi

Bangkok
Samutprakarnn

Figure 2: Map of the Case Study Area RESEARCH METHODOLOGY In the social sciences, there are mainly three research approached that can be employed to conduct research, which are quantitative, qualitative and mixed methodologies. Truthfulness or reality typifies quantitative and qualitative methodologies, but it is the criteria for judging it that differ. The quantitative research methodology considers knowledge to be real that can be objectively measured

whilst the qualitative research methodology views reality as something that can be subjectively measured (Creswell, 2007). The mixed methodologies combine the quantitative and qualitative methodologies in a single project. These approaches were considered in terms of their appropriateness giving the objectives of the study and the quantitative approach was finally adopted. Surveys were used as the strategy of enquiry and the case study philosophical approach was adopted (with Thailand as the case study). Questionnaire was designed and administered to the surveys participants who were randomly selected from an established sampling frame. The questionnaire was designed based on the researchers experience in Thailand real estate sector and relevant literature and the reliability of the questionnaire was verified by the experts opinions prior to the administration of the questionnaire. Fifty (50) sets of questionnaires were distributed to the sampled survey participants in June 2009 via post. The questionnaire consisted of 29 questions divided into four sections and covered various aspects like respondents characteristics, real estate projects that participants had engaged in, decision makers roles and perception of participants towards risks. Thirty nine (78%) responded to the questionnaires and the data was analysed using SPSS. Parametric statistical techniques like Independent T-Test, ANOVA and Rank Correlation analyses were carried out. DATA PRESENTATION AND ANALYSIS Attributes of Respondents The survey data revealed that the respondents occupy various positions in real estate companies: 36% (14 out of 39) were quantity surveyors or estimators whilst project managers/directors and engineers/architects constituted 25% (9 out of 39) each. Fifty-six percent (22 out of 39) were decision makers regarding risks but only 43% (17 out of 39) had any risk assessment experience in real estate projects and 15% (6 out of 39) had used any risk assessment models before. Only 10% (4 out of 39) were aware of AHP or ANP. Most of them (56% or 22 out of 39) had undergraduate degree and their working experiences ranged from 0 to 5 working years. Sixty-one percent of the respondents (24 out of 39) were involved in low rise /housing residential projects whilst 15% were involved in hotel projects; 10% (4 out of 39) were involved in high-rise residential projects and retail projects constituted 2.6% (1 out of 39). It was also found that 25% (10 out of 39) of the participants were located outside of Bangkok Metropolitan Area (BMA) and the same percentage of projects were located within Bangkok Metropolitan Area (BMA) Satisfaction Regarding Current Risk Assessment Techniques There was a low response rate to a question that bordered on practitioners satisfaction with the current risk assessment techniques as only six respondents representing 15.40% answered that question. The statistics in Table 1 shows a mean value of 3 (using the Likert scale where 1 is very dissatisfied; 3 is neutral; and 5 is very satisfied) amongst these respondents. Thus, it implies that the respondents were neither satisfied nor dissatisfied with the current risk assessment techniques. To verify these results, the independent T-test was conducted to test the equality of the mean of this set of respondents. Results derived by T-Test shows that the significance level is 1.0, meaning that there is no significant difference between the Means.

Table 1: Statistics on Satisfaction towards Current Risk Assessment Models

Experience in risk assessment Yes No Yes No N 6 1 6 1 Mean 3.00 3.00 3.00 3.00 Std. Deviation 0.6325 . 0.6325 Std. Error Mean 0.2582 . 0.2582 .

Satisfaction in model usage Satisfaction in model' s effectiveness

The independence T-Test was then conducted in order to verify the differences between the mean of these two groups of respondents. The value derived by this test gives a significance level is 1.00 (as shown in Table 2), which means there was no significant difference between these variables, and no difference between each mean. Perhaps a larger-scale survey than this with a higher response rate could produce more insights on this issue. Table 2: T-test Value of Satisfaction towards Current Risk Assessment Models
t-test for Equality of Means t Df. Sig. (2tailed) Mean Difference Std. Error Difference 95% Confidence Interval of the Difference

Lower Satisfaction in Equal variances assumed model use Equal variances not assumed Satisfaction in Equal variances assumed model' s effectiveness Equal variances not assumed 0.00 . 0.00 . 5 . 5 . 1.00 . 1.00 . 0.00 0.00 0.00 0.00 0.6831 . .06831 -1.7560 . -1.7560

Upper 1.7560 . 1.7560

There were 10 survey participants who responded the question that bordered on risk assessment techniques currently being used in their projects. It was established that the panel discussion is the most popular technique that is used as 70% (7 out of 10) of the decision makers had used it whilst 20% (2 out of 10) employed secondary information from reliable sources. Those who used background experience represented the remaining 10%. The results show that Thai practitioners still rely on non-systematic risk assessment techniques, which is unlikely to provide the precise information enough to make a decision towards risk in the real estate sector. The Practitioners Perceptions of Risks that Emanate from STEEP Factors Descriptive frequency and correlation tests were used to assess the perceptions of respondents regarding risks caused by STEEP factors. The percentages of their opinions in terms of the consequences of risks and the likelihood of their occurrence are summarised in the Tables 3 and 4 below.

Table 3: Perceptions of STEEP Factors Consequences (%)

Very High (%) High (%) Neither high nor low (%) Low (%) Very Low (%) Not responded (%)

Social Technological Environmental Economical Political

15.4 10.3 2.6 46.2 23.1

17.9 12.8 30.8 20.5 30.8

30.8 33.3 28.2 5.1 10.3

17.9 17.9 17.9 2.6 10.3

5.1 12.8 7.7 12.8 10.3

12.8 12.8 12.8 12.8 15.4

Table 4: Perceptions towards the Likelihood of Risk Occurring from STEEP Factors (%)
Very High (%) High (%) Neither high nor low (%) Low (%) Very Low (%) Not responded (%)

Social Technological Environmental Economic Political

15.4 15.4 5.1 38.5 23.1

12.8 12.8 20.5 20.5 25.6

33.3 23.1 35.9 7.7 20.5

17.9 23.1 15.4 10.3 10.3

7.7 12.8 10.3 5.1 7.7

12.8 12.8 12.8 12.8 15.4

The results from the Table 3 indicate that Thai practitioners prioritised risks caused by economic and political as they considered them to have the strongest impact on the progress of their project whilst social and technological risks were considered to have a low impact on projects. In terms of the STEEP risks likelihood of occurrence, Table 4 shows that the likelihood of economic risk occurring is the highest, followed by political, social and technological in that order. Environmental issues are considered to have the least impact on real estate projects in terms of the consequences and regarding likelihood of occurrence it they also ranked the lowest. Correlation tests were then carried out to determine the correlation between each STEEP factor and the perception of practitioners. The results are summarised in Table 5. From the Table, The there were 8 variables which were strongly correlated (p < 0.05) while the rest did not show a significant correlation. This shows that Thai practitioners are more concerned with risks caused by economic and political factors that other sources of risks.

Table 5: The Correlation of STEEP Factors

Based on the findings from the empirical data above, secondary data was then used to make a comparison between Thai and Western real estate practitioners (using Dutch and British) in order to determine whether there are differences between their perceptions of STEEP risks and how they assess risks in real estate projects. The perceptions are compared and ranked in Table 6 below whilst a comparison of risk assessment techniques are indicated in Table 7.
Table 6: Comparison of Practitioners Perceptions towards Risks Emanating from STEEP Factors R 1 2 3 4 Thai Economic (32%) Political (26%) Social (16%) Environmental (16%) Technological (11%) Khumpaisal (2009) Dutch Political (34%) Technological (31%) Economic (15%) Environmental (13%) Social (7%) Gehner et al. (2006) British Economic (35%) Technological (22%) Social (20%) Environmental (13%) Political (9%) Khumpaisal and Chen (2009)

5
S

Table 7: Comparison of Risk Assessment Techniques

Risk assessment techniques Non systematic techniques (i.e. work experience/intuition, probabilistic) Western 58% Thailand 80%

Systematic / pragmatic techniques (i.e. sensitivity analysis, matrix, model, Monte Carlo, reliable 2nd sources) Source:

42%

20%

Gehner et al. (2006)

Khumpaisal (2009)

From Table 7 nearly a half (42%) of the Western practitioners employ systematic risk assessment techniques such as sensitivity analysis, assessment checklists or risk premium. Regarding Thai practitioners, 80% use non-systematic assessment methods, particularly, the panel discussion techniques, which provide less precise details as to how to deal with risks in the real estate sector. Generally, the results of the survey are varied depending on the definition of risks by survey participants and their experiences in dealing with real estate projects as well as the environment surrounding their developed projects.

CONCLUSION
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APPENDIX A:

Descriptive statistics
1.1. Positions held by respondents in real estate development projects
P osition Frequency 10 5 10 14 39 P ercent 25.6 12.8 25.6 35.9 100.0 V alid P ercent 25.6 12.8 25.6 35.9 100.0 C ulative um P ercent 25.6 38.5 64.1 100.0

V alid

P roject M anager/ D irector P roject C oordinator E ngineer/ A rchitec / t D esigner O ther Total

1.2. The decision-maker role in the real estate project

D ecision M aker Frequency 22 16 38 1 39 P ercent 56.4 41.0 97.4 2.6 100.0 V alid P ercent 57.9 42.1 100.0 C ulative um P ercent 57.9 100.0

V alid

M issing Total

yes N o Total 0

1.3. Working experiences (years)

W r in E p rie c (Y a s ok g x e n e e r ) F qec re u n y V lid a 0 -5 6 0 -1 1 -1 1 5 1 -2 6 0 2 a oe 1 bv T ta o l 1 7 1 2 5 3 2 3 9 P rc n e et 4 .6 3 3 .8 0 1 .8 2 7 .7 5 .1 10 0 .0 V lid P rc n a e et 4 .6 3 3 .8 0 1 .8 2 7 .7 5 .1 10 0 .0 C m la e u u tiv P rce t e n 4 .6 3 7 .4 4 8 .2 7 9 .9 4 10 0 .0

1.4. Experience in risk assessment

E xperience in risk assessm ent Frequency 17 20 37 2 39 P ercent 43.6 51.3 94.9 5.1 100.0 V alid P ercent 45.9 54.1 100.0 C ulative um P ercent 45.9 100.0

V alid

M issing Total

yes N o Total .00

1.5. Used of any risk assessment models/ techniques

U e o a ym d l sd f n o e F qec re u n y V lid a ys e N o T ta o l .0 0 6 2 5 3 1 8 3 9 P rc n e et 1 .4 5 6 .1 4 7 .5 9 2 .5 0 10 0 .0 V lid P rc n a e et 1 .4 9 8 .6 0 10 0 .0 C m la e u u tiv P rc n e et 1 .4 9 10 0 .0

Ms g is in T ta o l

1.6. If they did not employ risk assessment model, how could they assess risks in real estate project?
How to assess if no m odel Frequency Valid By working experience Panel discussion Secondary informaiton Total .00 1 7 2 10 29 39 Percent 2.6 17.9 5.1 25.6 74.4 100.0 Valid Percent 10.0 70.0 20.0 100.0 Cumulative Percent 10.0 80.0 100.0

Missing Total

1.7. The knowledge in Analytical Network Process (ANP) or Analytical Hierarchical Process (AHP)
K o le g inA PA P n w d e H N F qec re u n y V lid a ys e N o T ta o l .0 0 4 3 1 3 5 4 3 9 P rc n e et 1 .3 0 7 .5 9 8 .7 9 1 .3 0 10 0 .0 V lid P rc n a e et 1 .4 1 8 .6 8 10 0 .0 C m la e u u tiv P rc n e et 1 .4 1 10 0 .0

Ms g is in T ta o l

1.8. Type of the real estate projects

T p o po c y e f r je t F q e cy re u n V lid a L wris / h u g p je o e o sin ro ct h h ig rise c n o in m/ o d m iu aa et p rtm n re il ta cm e l o m rcia o e th r T ta o l 0 2 4 4 1 1 6 3 6 3 3 9 P rc n e et 6 .5 1 1 .3 0 2 .6 2 .6 1 .4 5 9 .3 2 7 .7 10 0 .0 V lid P rce t a e n 6 .7 6 1 .1 1 2 .8 2 .8 1 .7 6 10 0 .0 C m la e u u tiv P rce t e n 6 .7 6 7 .8 7 8 .6 0 8 .3 3 10 0 .0

M in iss g T ta o l

APPENDIX B: Statistical analysis of data 2.1. Questionnaires reliability

R liab e ility S tatis s tic C n c 's ro ba h A ha lp .6 4 4 Nof Item s 3 1

2.2. T-test to verify Mean of respondents who used the risk assessment models.
G roup S tatistics E xperience in risk assessm ent yes N o yes N o N 6 1 6 1 M ean 3.0000 3.0000 3.0000 3.0000 S D td. eviation .63246 . .63246 . .25820 . S E td. rror M ean .25820 .

S atisfaction in m odel S atisfaction in m odel' s effectiveness

Independent Samples Test

Levene's Test for Equality of Variances

t-test for Equality of Means 95% Confidence Interval of the Difference

F
Satisfaction in model Equal variances assumed Equal variances not assumed Equal variances assumed Equal variances not assumed

Sig.

t . .000 .

df 5 . 5 .

Sig. (2tailed) 1.000 . 1.000 .

Mean Difference .00000 .00000 .00000 .00000

Std. Error Difference .68313 . .68313 .

Upper -1.75604 . -1.75604 .

Lower 1.75604 . 1.75604 .

Satisfaction in model' s effectiveness

.000 .

APPENDIX C:

The perceptions of STEEP factors

3.1. The consequence of each risk to real estate projects 3.1.1. Social risk

L v l o S c l r k to p o c e e f o ia is r je t F qec re u n y V lid a V ry H h e Ig H h Ig Md m e iu Lw o V ry lo e w T ta o l .0 0 6 7 1 2 7 2 3 4 5 3 9 P rc n e et 1 .4 5 1 .9 7 3 .8 0 1 .9 7 5 .1 8 .2 7 1 .8 2 10 0 .0 V lid P rc n a e et 1 .6 7 2 .6 0 3 .3 5 2 .6 0 5 .9 10 0 .0 C m la e u u tiv P rc n e et 1 .6 7 3 .2 8 7 .5 3 9 .1 4 10 0 .0

Ms g is in T ta o l

3.1.2. Technological risk

L v l o T c o g a r k to p o c e e f e h lo ic l is r je t F qec re u n y V lid a V ry H h e Ig H h Ig Md m e iu Lw o V ry lo e w T ta o l .0 0 4 5 1 3 7 5 3 4 5 3 9 P rc n e et 1 .3 0 1 .8 2 3 .3 3 1 .9 7 1 .8 2 8 .2 7 1 .8 2 10 0 .0 V lid P rc n a e et 1 .8 1 1 .7 4 3 .2 8 2 .6 0 1 .7 4 10 0 .0 C m la e u u tiv P rc n e et 1 .8 1 2 .5 6 6 .7 4 8 .3 5 10 0 .0

Ms g is in T ta o l

3.1.3. Environmental risk

L v l o E v o m n l r k to p o c e e f n ir n e ta is r je t F qec re u n y V lid a V ry H h e Ig H h Ig Md m e iu Lw o V ry lo e w T ta o l .0 0 1 1 2 1 1 7 3 3 4 5 3 9 P rc n e et 2 .6 3 .8 0 2 .2 8 1 .9 7 7 .7 8 .2 7 1 .8 2 10 0 .0 V lid P rc n a e et 2 .9 3 .3 5 3 .4 2 2 .6 0 8 .8 10 0 .0 C m la e u u tiv P rc n e et 2 .9 3 .2 8 7 .6 0 9 .2 1 10 0 .0

Ms g is in T ta o l

3.1.4. Economic risk

L ve o E on m a ris to p ject e l f c o ic l k ro F qu c re en y V lid a V H ery Igh H h Ig M iu ed m Lo w V lo ery w T otal .0 0 1 8 8 2 1 5 3 4 5 3 9 P erce t n 46 .2 20 .5 5.1 2.6 12 .8 87 .2 12 .8 1 .0 00 V alid P erce nt 52 .9 23 .5 5 .9 2 .9 14 .7 1 0.0 0 Cm u ulative P rc t e en 5 2.9 7 6.5 8 2.4 8 5.3 10 .0 0

M issin g To tal

3.1.5. Political risk

L v l o P litic l r k to p o c ee f o a is r je t F qec re u n y V lid a V ry H h e Ig H h Ig Md m e iu Lw o V ry lo e w T ta o l .0 0 9 1 2 4 4 4 3 3 6 3 9 P rc n e et 2 .1 3 3 .8 0 1 .3 0 1 .3 0 1 .3 0 8 .6 4 1 .4 5 10 0 .0 V lid P rc n a e et 2 .3 7 3 .4 6 1 .1 2 1 .1 2 1 .1 2 10 0 .0 C m la e u u tiv P rc n e et 2 .3 7 6 .6 3 7 .8 5 8 .9 7 10 0 .0

Ms g is in T ta o l

3.2. The likelihood of each STEEP and affect to real estate project 3.2.1. Social risk

F e u n yo S c l r ktop o c r q e c f o ia is r je t F qec re u n y V lid a V ryH h e Ig H h Ig Md m e iu Lw o V rylo e w T ta o l .0 0 6 5 1 3 7 3 3 4 5 3 9 P rc n e et 1 .4 5 1 .8 2 3 .3 3 1 .9 7 7 .7 8 .2 7 1 .8 2 10 0 .0 V lidP rc n a e et 1 .6 7 1 .7 4 3 .2 8 2 .6 0 8 .8 10 0 .0 C m la e u u tiv P rc n e et 1 .6 7 3 .4 2 7 .6 0 9 .2 1 10 0 .0

Ms g is in T ta o l

3.2.2. Technological risk

F q n yo T re ue c f ech o ica ris to pr je n log l k o ct F qu c re en y V lid a V H ery Igh H h Ig M iu ed m Lo w V lo ery w T otal .0 0 6 5 9 9 5 3 4 5 3 9 P erce t n 15 .4 12 .8 23 .1 23 .1 12 .8 87 .2 12 .8 1 .0 00 V alid P erce nt 17 .6 14 .7 26 .5 26 .5 14 .7 1 0.0 0 Cm u ulative P rc t e en 1 7.6 3 2.4 5 8.8 8 5.3 10 .0 0

M issin g To tal

3.2.3. Environmental risk

F e u n y o E v o m n l r ktop o c r q e c f n ir n e ta is r je t F qec re u n y V lid a V ry H h e Ig H h Ig Md m e iu Lw o V ry lo e w T ta o l .0 0 2 8 1 4 6 4 3 4 5 3 9 P rc n e et 5 .1 2 .5 0 3 .9 5 1 .4 5 1 .3 0 8 .2 7 1 .8 2 10 0 .0 V lidP rc n a e et 5 .9 2 .5 3 4 .2 1 1 .6 7 1 .8 1 10 0 .0 C m la e u u tiv P rc n e et 5 .9 2 .4 9 7 .6 0 8 .2 8 10 0 .0

Ms g is in T ta o l

3.2.4. Economic risk

F e u n yo E o o ic r ktop o c r q e c f c n m l is r je t F qec re u n y V lid a V ryH h e Ig H h Ig Md m e iu Lw o V rylo e w T ta o l .0 0 1 5 1 0 3 4 2 3 4 5 3 9 P rc n e et 3 .5 8 2 .6 5 7 .7 1 .3 0 5 .1 8 .2 7 1 .8 2 10 0 .0 V lidP rc n a e et 4 .1 4 2 .4 9 8 .8 1 .8 1 5 .9 10 0 .0 C m la e u u tiv P rc n e et 4 .1 4 7 .5 3 8 .4 2 9 .1 4 10 0 .0

Ms g is in T ta o l

3.2.5. Political risk

F e u n yo P litic l r ktop o c rqec f o a is r je t F qec re u n y V lid a V ryH h e Ig H h Ig Md m e iu Lw o V rylo e w T ta o l .0 0 9 1 0 8 4 3 3 4 5 3 9 P rc n e et 2 .1 3 2 .6 5 2 .5 0 1 .3 0 7 .7 8 .2 7 1 .8 2 10 0 .0 V lidP rc n a e et 2 .5 6 2 .4 9 2 .5 3 1 .8 1 8 .8 10 0 .0 C m la e u u tiv P rc n e et 2 .5 6 5 .9 5 7 .4 9 9 .2 1 10 0 .0

Ms g is in T ta o l

3.3. One-way ANOVA to test the Mean Value

A O A N V S um of S quares 1.448 42.670 44.118 7.666 39.863 47.529 5.466 29.504 34.971 8.221 60.750 68.971 5.927 52.255 58.182 6.762 40.767 47.529 5.056 52.826 57.882 5.028 32.854 37.882 4.628 47.254 51.882 1.531 50.939 52.471 df 4 29 33 4 29 33 4 29 33 4 29 33 4 28 32 4 29 33 4 29 33 4 29 33 4 29 33 4 29 33 2.055 2.095 1.482 1.866 1.691 1.406 1.264 1.822 1.257 1.133 1.157 1.629 .383 1.757 .981 .433 M ean S quare .362 1.471 1.917 1.375 1.367 1.017 F .246 S ig. .910

Level of S ocial risk to project Level of Techological risk to project Level of E nvironm ental risk to project

B een G etw roups W ithin G roups Total B een G etw roups W ithin G roups Total B een G etw roups W ithin G roups Total B een G etw roups W ithin G roups Total B een G etw roups W ithin G roups Total B een G etw roups W ithin G roups Total B een G etw roups W ithin G roups Total B een G etw roups W ithin G roups Total B een G etw roups W ithin G roups Total B een G etw roups W ithin G roups Total

1.394

.261

1.343

.278

Level of E conom ical risk to project Level of P olitical risk to project Frequency of S ocial risk to project Frequency of Technological risk to project Frequency of E nvironm ental risk to project Frequency of E conom icl risk to project Frequency of P olitical risk to project

.794

.539

1.203

.331

.694

.602

1.110

.371

.710

.592

.218

.926