Complicated Commercial Real Estate Portfolio

An Alera Group member company based in Southern California was retained by a commercial real estate property manager to review the insurance policies of a large, diverse portfolio of buildings in downtown Los Angeles that was valued at more than $200 million. The portfolio included many types of buildings: high-rise, low-rise, retail strips, offices, one vacant property, and even a historical building. A new owner had just purchased the portfolio, and the property manager contacted Alera Group because of their demonstrated expertise in a previously existing working relationship.

Process

Alera Group’s first step was to analyze the complete insurance policies in place for each building, taking extensive notes about any gaps in coverages, deficiencies, and other concerns. These were then compiled into a comprehensive report and presented to the property manager and portfolio owner.

From there, the Alera Group team worked closely with the property manager to create a new, customized insurance solution for each property, taking into account the various ages, uses, and occupancies of each building, as well as any unique physical and/or geographical considerations. Next, they consulted with the portfolio owner and secured comprehensive, property-specific coverage for each location.

Challenges

Because of the fast-paced nature of commercial real estate, this project was extremely time sensitive. Upon purchase, the portfolio owner inherited outdated, inadequate insurance – a situation that could cost exorbitant amounts of money in the event of a claim, and that needed to be remedied immediately.

After Alera Group determined an ideal coverage package for each property within the portfolio, a multi-stage process requiring inspections, appraisals, and underwriting began. The team hustled to coordinate all of this, while ensuring that the pricing was fair, and that the policies covered every possible contingency.

Results

As a result of Alera Group’s attention to detail and sense of urgency, the portfolio owner benefited from:

  • Insurance policies that filled in coverage gaps
  • Insurance policies that eliminated unreasonable restrictions for filing claims
  • Insurance policies that accurately reflect replacement costs, due to immediately ordering appraisals
  • An insurance premium savings of approximately $200,000 in the first year

Additionally, the property manager achieved “rock star status” with the portfolio owner for proactively reaching out to Alera Group for a detailed and efficient insurance review. They now consistently refer their colleagues to the Alera Group for their insurance needs.