Operating-building due diligence

Building risk register and decision report

A buyer-facing working format in which each building risk is tied to evidence, consequence, specialist, action, contract control and residual uncertainty.

Facts, party statements, analytical conclusions and unknowns are shown separately. Re-check evidence for the date of the specific transaction.

Updated 23 July 2026

In short

A building risk register is not a project rating and does not attempt to calculate a ‘probability of safety’. It is a working record connecting a defined failure or liability scenario to evidence, potential consequence, responsible specialist, pre-completion action, contractual control and residual uncertainty.

NovAsia already has a general property-purchase risk register. This page does not reproduce it: it is limited to the operating building and common property. Unit title, seller authority, SPA, payment and investment-exit risks remain in the wider transaction review and are linked rather than duplicated.

Why one score hides risk

Safety, documents, governance, money and technical condition rely on different evidence and have different consequences. An average score can hide a critical issue behind several strong indicators.

Use an unresolved-risk list instead: event, affected asset, urgency, confirmed facts, unknowns, owner, required action and transaction stop condition.

How to state the evidence position

Use plain states: document-confirmed; stated by a party; sources conflict; unconfirmed. Mark stale evidence or non-applicability separately where relevant.

The state belongs to a particular fact, building, phase and date. It cannot be transferred to a neighbouring asset or replaced by editorial confidence.

Fields for every risk entry

Record the risk, category, affected system or right, fact and source, date, evidence position, likelihood, possible consequence, urgency, temporary control, required document or inspection, owner, deadline, closure cost where available, residual risk and stop condition.

Leave an unknown likelihood or cost unknown. Do not use zero as a substitute for missing information.

Keep risk categories separate

Legal and authorisation layer: occupancy scope, change of use, management authority and governing rules.

Life safety and critical systems: fire, evacuation, lifts, water, power, generator, drainage and dangerous components.

Physical condition: façade, roof, waterproofing, corrosion, leaks, damp, parking and common areas.

Operations: contractors, preventive work, records, emergency response, staff, access and complaints.

Finance: budget, collection rate, arrears, reserves, special assessments, subsidy and major works.

Governance: decisions, conflicts, related contractors, reporting and developer handover.

Commercial usability: letting rules, resident experience, prolonged system downtime and demand impact.

External and phasing factors: flooded access, adjacent construction, shared networks, future load and cost allocation.

Do not mix consequence, likelihood and evidence quality

Consequence asks what happens if the scenario occurs. Likelihood describes frequency or plausibility only where there is an adequate basis. Confidence describes the reliability of the evidence. These fields are independent: an event may be rare but severe, frequent but minor, or not assessable because records are weak.

For the site, defined verbal levels of consequence and urgency are safer. Examples are `life-safety specialist required before decision`, `material cost exposure`, `operational inconvenience` and `monitor`. Do not assign a colour solely from editorial judgement. Colour may support action status visually, but text must always remain visible.

Five decision statuses

`proceed` — material questions are closed within the agreed scope and ordinary limitations are stated.

`proceed-with-conditions` — a defined deliverable controls the risk before payment or completion.

`specialist-review-required` — the decision cannot be made without a lawyer, engineer, accountant or other specialist.

`reprice-or-allocate` — an evidenced liability must be reflected in price, retention, escrow or cost allocation.

`decline-or-defer` — critical evidence is absent, the consequence is unacceptable or the counterparty rejects necessary protection.

The status applies to a particular unit, price, date and conditions. It is not a permanent building rating and must change when evidence changes.

Turn risk into a verifiable contract control

‘The seller will fix everything’ is not a control. A condition should identify the document or outcome, responsible party, acceptance standard, deadline, inspection right, consequence of failure and treatment of funds. Depending on the transaction this may be a condition precedent, retention, escrow, specific warranty, indemnity, price adjustment, clearance or termination right.

The technical outcome should be defined by the appropriate specialist. Instead of ‘repair the pump’, specify the scope, evidence and test. Counsel adapts the mechanism to the SPA and applicable law. This page does not provide a universal contract clause.

Show cost as a range and preserve unknowns

For an evidenced work item record the scope, valuation date, source, taxes, contingency, timing and responsible payer. Where only a preliminary estimate exists, show a range and sensitivity. Do not divide a total bill by the unit without checking the allocation basis: area, lot share, rules, owner resolution and non-payment risk affect the result.

Use separate fields for `known amount`, `estimated range`, `unallocated`, `contingent` and `unknown`. Unknowns must not default to zero or the midpoint. In the final decision show best, working and stress cases as scenarios, not forecasts.

Examples of a useful risk entry

Lift: two repeat failures in three months; contractor recommends controller replacement; no quotation is available. Consequence is loss of access for a high-floor unit and future cost. Evidence status is reports confirmed, cost unknown. Action is vendor inspection and written quotation before unconditional payment.

Reserve: cash balance is confirmed, but the plan includes façade and pumps without component allocation. Consequence is a possible special assessment. Action is an updated major-works schedule and funding resolution; do not treat the full reserve as available for the selected work.

Occupancy: a document for Tower A is provided while the unit is in Tower B. Consequence is unconfirmed authorisation scope. Action is the relevant document or written competent review for Tower B; transaction status is `defer`, not ‘probably covered’.

Contradictions are a risk, not an editing problem

If management says a system is serviced monthly, the contract provides quarterly visits and the log contains no report for a year, create a separate contradiction entry. Identify the parties, records, dates, possible explanations and the person able to resolve it.

Do not delete the old version when a new answer arrives. Preserve chronology and the explanation for change. A late correction may be legitimate, but it should leave an audit trail. For a material issue require evidence, not only a replacement statement.

Refresh the register at transaction gates

Before reservation: use public and voluntarily supplied evidence; keep unknowns visible.

Before SPA or non-refundable payment: define required records, specialists and conditions.

During due diligence: replace statements with evidence, complete inspections and obtain quotations.

Before final payment or completion: close conditions precedent, obtain unit clearance and check for new events.

At handover: record keys, access, deposits, open defects and management contacts.

After a material incident or owner resolution: update the register, cost exposure and owner plan.

How to present the final review

Begin with the decision: proceed, proceed subject to conditions, pause for evidence or stop. Then list critical facts, unresolved risks, actions required before payment, owners and deadlines.

Show which issues belong with counsel, an engineer, building management, an insurer or a bank. Attach the document index and change history so the decision can be revisited when new evidence arrives.

Preserve a version, not a permanent conclusion

The conclusion applies to a date and evidence set. A new budget, special assessment, fire, flood, manager change, phase handover, major failure, rule amendment or new quotation can make it stale. Define refresh events and a file owner.

Retain version number, change log, sources and link-check date. Where NovAsia publishes an example or template, it must not expose confidential data or create a public rating for a named building without a defensible methodology, publication rights and correction process.

When a risk remains open

A risk is not closed by “probably acceptable”, an uncontextualised photograph, a seller assurance or a document for another phase. Closure requires evidence that answers the original question: a document, authority check, technical inspection, completed work, payment, corrected agreement or another verifiable result.

Where evidence cannot be obtained, the decision should state the uncertainty and its consequence explicitly.

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