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Derhake: Lenders Face Pressures on Risk Management

Globe Street interviewed President of Partner Joseph Derhake, PE about lenders' increased focus on risk management.

TORRANCE, CA—The increasingly competitive deal landscape demands that lenders pay close attention to more than financial terms, crucial though those may be. There’s also an imperative to focus on risk management, as Joseph Derhake, CEO of Partner Engineering and Science Inc., will attest. caught up with Derhake and what he’s seeing in this area, which he describes as the fastest-growing segment of Partner’s business, as 2015 gets underway. What factors are motivating lenders to put more emphasis on risk management?

Joe Derhake: Regulated institutions are seeing pressure from regulators, and CMBS lenders are seeing some pressure as well as discipline from the prime buyers and the B-piece buyers. In both instances, lenders are less likely to skip steps, and they have a more proscriptive approach to due diligence: "You have to get this report, or that report." They're more likely to have specialists read the reports, as opposed to just general finance professionals, and they're more likely to address the issues.

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