ILS ADVISORY GROUP
AFFILIATE ADVISOR/REGIONAL OFFICE INFORMATION

INTRODUCTION

Thank you for your interest in becoming an Affiliate Advisor or Affiliate Regional Office of ILS Advisory Group. 

ILS Advisory Group is a growing commercial realty valuation and advisory resource which specializes in providing services for institutional use not typically available in the current marketplace.  We are doing this by combining our national resources and enhanced products and services with the experience and assets of quality local appraisers, advisors and appraisal firms.  The result for our clients is a single point of contact on a national basis for a wide variety of realty services delivered in a mostly consistent format for single or multi-property assignments all reflecting unparalleled local market knowledge.  In short, our ability to provide the resources of a large firm without sacrificing the local market knowledge of a small firm is giving our clients a competitive edge. 

We are currently seeking to “partner” with qualified senior valuation advisors and “one person” or small local firms to support our expanding client base.  We feel the relationship will be mutually beneficial and is reflective of a future networking trend in the commercial appraisal industry which will better position you for the future. 

Benefits to being an Affiliate Advisor or Affiliate Regional Office of ILS Advisory Group are: 

BUSINESS OBJECTIVE 

ILS Advisory Group is a “for profit” company.  One of our main objectives is to compete with national/regional firms by offering better quality regional services through the utilization of an integrated network of experienced, local advisors and firms.  We feel this is an advantage over most national/regional firms that generally deliver generic reports that lack in-depth local market knowledge since they are performed by junior, non-local associates.  Our overall lower overhead should also give us a price advantage in most cases.  Finally, our ability to offer alternative, cost effective/time efficient evaluation solutions and the convenience of “one stop” shopping for loan related services are other advantages. 

Profit, however, is not the only factor in our formation towards this objective.  A secondary objective of ILS Advisory Group’s ownership is to maintain a structure which allows small, privately owned and operated appraisal firms (the heart and soul of the appraisal industry) to enhance their businesses by participating in the performance of national assignments.  These assignments are generally more challenging and profitable but are typically only available to national/regional firms due to their capability to provide national coverage or “special purpose” property expertise.  With the formation of ILS Advisory Group, small appraisal firms who offer outstanding quality are now able to compete for this work through a fully coordinated and integrated structure. 

In summary, ILS Advisory Group is a “win-win” situation for all involved.  It offers affiliate advisors and affiliate firms the ability to compete for national/regional assignments which are typically only available to national/regional firms.  In return, ILS Advisory Group receives an equitable, but fair, discount from its affiliates which allows it the potential for profit.  Our clients receive regional service with superior market knowledge and superior pricing. 

BUSINESS DESCRIPTION 

ILS Advisory Group’s structure is that of an appraisal management company specializing in commercial property.  This concept has operated with great success in the residential appraisal business and is now becoming effective for the commercial appraisal business. 

Generally, an appraisal management company obtains business by offering services not typically available through small local firms such as regional coverage, “one stop” shopping for other related services, consistent regional reporting, monthly or multiple assignment billings, etc.  In return for these services, which typically reduce “back office” appraisal administration costs, customers pay a premium over typical “local” appraisal fees. 

Appraisals are typically prepared by a network of affiliate appraisers.  In return for having appraisal business originated for them by the appraisal management company, appraisers perform their services at a discount off of their typical “local” fees. 

ILS Advisory Group’s income is comprised of both the premium over typical “local” appraisal fees and the discount provided by ILS Affiliate Advisors and Local Offices off their typical “local” appraisal fees. 

AFFILIATE DESCRIPTION 

Affiliate Office – Sole proprietor or small appraisal firm which remains independently owned but also serves as an Affiliate Office of ILS Advisory Group.  In addition to providing appraisals, it may also provide local appraisal review services and sales services for ILS Advisory Group in its exclusive geographic territory. 

Affiliate Advisor – An independent contractor of ILS Advisory Group for “special purposes” properties or excess assignments in a geographic area which cannot be serviced through the ILS Advisory Group Affiliate Office. 

QUALIFICATION 

All Affiliate Offices and Advisors will hold the MAI Designation of the Appraisal Institute.  We feel this is the best way to achieve and maintain quality appraisal services. 

AFFILIATE RESPONSIBILITIES 

Advisors – Affiliate Advisors are responsible for the complete preparation of appraisals including typing the report, obtaining all data, all supplies related to the preparation of the report including pictures, all equipment/communication during the preparation of the report, office space expenses, if any, and internal overhead, with the exception of billing, accounts receivable and bad debt risk.  Upon completion of the report, it will be emailed to ILS Advisory Group.  ILS Advisory Group will then produce all report originals and deliver them to the client.  ILS Advisory Group will also assume all costs, responsibility and risks associated with billing, accounts receivable, bad debt risk and E&O. 

Offices – Affiliate Offices have the same responsibilities as Affiliate Advisors with respect to report preparation, but also may have Sales Representative and/or Review Appraiser responsibility. 

ASSIGNMENT OPERATION 

The following is an example of how an assignment typically flows through ILS Advisory Group: 

Sales Representative/Local Affiliate Office Manager – This person identifies a potential assignment.  After obtaining adequate information on the property to develop a quote, a Request For Proposal (RFP) is emailed/faxed to ILS Advisory Group Assignment Manager.  The Assignment Manager then forwards RFP to ILS Advisory Group Affiliate Office/Advisor for a “local” fee quote.  Once completed, the fee quote is then forwarded back to the Assignment Manager and then to the Sales Representative for communication to the potential client.  The final fee quote and time quote to the client will be “grossed” up to account for ILS Advisory Group’s overhead.  If accepted, the Sales Representative will then send out a contract for signature and retainer (if applicable) with instructions to return signed contract to ILS Advisory Group Administration/Central Office. 

Assignment Manager – Upon receipt of contract, the Assignment Manager forwards request to Appraiser for completion.  Assignment Manager tracks assignments to insure completion on time or receives and communicates delays.  Once “draft” report is completed and received, it is reviewed by Review Appraiser.  Once approved, Assignment Manager assumes responsibility to produce original reports, deliver to client and bill client.  All originals are sent on ILS Advisory Group stationery. 

Assignment Review – Assignment Reviewer “troubleshoots” with appraiser during production and reviews final report before any verbals or draft copies are forwarded to customer. 

Appraiser – Completes appraisal and forwards report via email with all exhibits to ILS Advisory Group for production. 

ILS Advisory Group Administration – ILS Advisory Group Administrator is responsible for insurance coverage, accounts receivable, bad debt risk and payment to all affiliates. 

AFFILIATE FEE SPLITS/FEES

 Affiliate Office/Advisors – Fee splits/fees are based on a “partnership” with ILS Advisory Group based on a “work performed/responsibility assumed/risk taken” concept.  They may vary by assignment but the typical fee split of the “local” assignment fee is calculated as follows:

Support services reflect a cost split between: the Affiliate Office/Advisor’s responsibility to complete a “draft” of the report; and ILS Advisory Group’s responsibility to produce all report originals utilizing ILS Advisory Group stationery and deliver or mail report to client. Administration reflects ILS Advisory Group’s responsibility for accounts receivable, bad debt risk and insurance coverage.  ILS Advisory Group’s affiliates will be paid upon completion of the assignment and not when the assignment is paid. Finally, ILS Advisory Group receives a sales referral fee. 

OTHER POLICIES AND PROCEDURES 

E&O Insurance – ILS Advisory Group provides and maintains an Errors and Omissions Policy covering each approved affiliate for any work completed for our firm.  You are not required to possess a personal policy to be considered for approval as an affiliate.  It is, however, suggested that you maintain one for your own personal protection. 

Payment Periods – ILS Advisory Group pays all fees upon completion of assignments but within a bi-weekly payment period. 

Affiliate Territories – Each Affiliate Office will be assigned a territory which will be their area of responsibility.  Particular care will be taken to insure that territories do not overlap to insure offices do not compete with each other in their local business.  This should insure that all offices maintain their competitive advantages in their local businesses.  Affiliate Advisors will be chosen based on their “special purpose”  (healthcare, hotel/motel, business, etc.) expertise.  They will then become ILS Advisory Group’s expert for all assignments in their area of expertise without regard to location.  Finally, other Affiliate Advisors will be added, as necessary, to provide additional coverage in a territory if it cannot be sufficiently served by the Affiliate Local Office. 

Data – ILS Advisory Group maintains many regional publications such as Korpacz and valuation programs such as Argus.  All Affiliates can have access to these services for use in their independent business, as necessary, on a per use or annual shared fee basis . 

Uniform Image – This is still being developed.  At the moment, we are only requiring that all Affiliate Offices state that they are “An Affiliate of ILS Advisory Group” in ILS Advisory Group blue on all of your local company's 1^st page stationery and business cards and have a link to ILS Advisory Group on your local company's website..

CLOSING COMMENTS 

Thank you for your interest in becoming an affiliate of ILS Advisory Group.  We welcome any additional questions or feedback you may have in regards to your affiliation.  We look forward to “partnering” in the future in a mutually beneficial relationship.