Graduate School of Management Spring 2005 MGT 276 REAL ESTATE FINANCE AND INVESTMENTS

Transcription

1 MGT 276 REAL ESTATE FINANCE AND INVESTMENTS Time Wednesdays, 6:00 p.m. to 9:00 p.m. Location One Capitol Mall (OCM-2) Instructor: Phone: Office Hours: - Class Website: Brian Woods (415) office (925) mobile Wednesdays without Guest Lecturers - one hour before class Wednesdays with Guest Lecturers - by appointment Brian.Woods@am.joneslanglasalle.com Accessible through My UC Davis portal system COURSE DESCRIPTION This course is a study of the major aspects of real estate finance and investment from the perspective of corporate, private, and public owners; investors; and users. Commercial properties will be emphasized. The course begins with an overview of the fundamentals of income producing real estate and builds on these concepts as we consider the forces that influence the cyclical, fragmented, and inherently local business of real estate investment. These foundation concepts are further considered in detail in a series of cases that will be presented and discussed in class both by the instructor and visiting lecturers. The course will expose students to current real world real estate finance and investment situations and people who shape them. The course is case-based, and students will be challenged to think on their feet in class. Students will have the opportunity to develop their business presentation skills through case discussions and a final project presentation. TEXTBOOKS AND READING 1. Required Text: Brueggeman, William B. and Fisher, Jeffrey D. Real Estate Finance and Investments, 12 th edition (McGraw-Hill/Irwin, 2004). 2. Handouts: Case studies, supplemental reading and lecture notes will be handed out in class or posted to the class website. Page 1 of 5

2 COURSE REQUIREMENTS 1. Exams There will be one in-class midterm exam. 2. Class Participation and Case Studies Cases will be used to introduce and explore many of the concepts introduced in the class. Students will be expected to have reviewed the cases prior to class. Thoughtful contributions to class discussions will enhance the learning process. 3. Team Project Team projects will be due over the last two weeks of class. Utilizing Microsoft PowerPoint, each team will present a 20 minute investment analysis for either a development or repositioning project of the team s choice. The team s presentation will include an overview of the property or project, market justification (supply and demand analysis) for funding the project, pro forma or historic income and expense information and an analysis of projected cash flows (leveraged and unleveraged, before and after tax). The team will be graded on the quality and conciseness of the oral presentation; financial analysis; investment recommendations; executive summary and poise in response to questions from the class during a brief Q &A. 4. Grading Class Participation 10% In-class Midterm Exam 30% Case Studies 25% Team Project and Presentation 35% There will be NO Final Exam Page 2 of 5

3 SCHEDULE, LECTURE TOPICS AND READING PLEASE NOTE: The schedule is being reviewed and updated against the newest edition of the textbook. A new version of the schedule, lecture topics and reading will be posted as soon as Professor Woods is able to update with the newest edition of the textbook. The schedule listed below is for the 11 th edition of the text. Lecture Topics Reading Week 1 - Overview of Real Estate Finance and Investment [April 6] 1. Practical Matters - Introductions - Course Expectations, Plans and Objectives - Student Evaluation, Participation and Projects - Some Useful Sources and Links Chapters 1, 2 and 3 2. Introduction to the Real Estate Industry - Defining the industry, the players and their roles - The real estate Products what s being sold 3. Markets and Cycles Handout - Stephen E. Roulac - Real Estate Market Cycles, Transformation Forces and Structural Change, 4. Some Basic Real Estate Finance and Investment Concepts - Real Estate Investment Pro Forma - Direct Capitalization and Discounted Present Value Week 2 - Leases and Leasing - Part 1 [April 13] 1. Elements and Basic Terms of the Commercial Lease - Defining the Premises - Base Rent - Operating Expenses, Taxes and Insurance - Tenant Improvements 2. Brokers 3. Introduction of Leasing Case Study - Set up Class Teams - Review Case Study Handout and Objectives Chapter 9 Page 3 of 5

4 Week 3 - Leases and Leasing - Part 2 [April 20] In-class Case: Lease Negotiation Case Study Week 4 Real Estate Investment Analysis and Problem Solving [April 27] Guest Speaker: Ze Figueirinhas, Vice President - Jones Lang LaSalle Angus Cartwright Case Study Silicon Valley Lease Restructure Case Study Chapters 8 and 10 Angus Cartwright Case Week 5 - Real Estate Development and Repositioning [May 4] Guest Speaker: Mark Regoli, Executive Vice President - South Bay Development Chapters 11, 13 and 15 Silicon Valley Investment Case Studies Week 6 - Midterm [May 11] No Assigned Reading Week 7 - Real Estate Investment Marketing and Sales [May 18] Guest Speaker: Randy Getz, Senior Vice President - CB Richard Ellis Chapter 20 Assignment Financial analysis of Investment Offerings presented in class Week 8 Corporate Real Estate [May 25] Guest Speaker: Robert Mitsch Vice President, Facility Planning & Development - Sutter Health Chapter 14 Financial analysis of Investment Offerings Due Page 4 of 5

5 Week 9 - Ownership Structures Partnerships, Syndications and REITs; Taxes; Team Project Presentations [June 1] Chapter 19 Week 10 - Team Project Presentations; Course Wrap-up [June 8] Page 5 of 5