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Date: March 2 - April 27, 2016 8 Week Course Day/Time: Wednesdays; noon - 2 p.m.
Eastern Location: Your Office Format: Online
This introductory course examines the seven stages of a comprehensive real estate development
model. With an emphasis on practical workplace applications, this course begins with raw land in
the land banking stage and continues through land packaging, land development, building
development, and building operations.
The real estate development model continues through the development process to include
building renovations and property redevelopment. The life cycle of a real estate development is
analyzed in terms of how value is created in each stage of development.
Session One presents the theoretical context of this seven stage model. Starting with Session
Two, each successive session will examine each principle development stage by outlining how
value is created, key players, critical tasks, controllable costs, and major risks. Examples
discussed in each stage will describe how to apply those principles to real world practices.
Finally, a special skills section will be presented at the end of each module. These special skills
will teach students how to perform basic calculations to estimate and analyze real estate values in
order to better understand value creation throughout the real estate development process.
Learning Objectives
Learning Objectives
By the end of this course, students will be able to:
Define the seven stages of the real estate development process in terms of
- How value is created
- Key players
- Critical Tasks
- Controllable costs
- Major Risks
Estimate overall property value, land value, mortgage value, and equity value
using direct capitalization methodology
March 2, 2016
Overview of the Real Estate Development Process
This session explores the Building Operations stage. We will review the critical tasks, major
risks, key players, and controllable costs of this stage. The special skills section will instruct
students how to estimate property value using a mortgage-equity analysis. This will be broken
into four parts. First, understanding how an underwriter may analyze a propertys value using
debt-coverage ratio, land to value ratio, and borrowers character. Second, how to estimate
mortgage value in terms of annual debt payment and mortgage constant. Third, to estimate the
equity value with the after financing cash flow and equity dividend rate. Finally, this session will
conclude with estimating returns after financing.
April 20, 2016
Building Renovation
Date: October 20 - December 15, 2016 8 Week Course Day/Time: Thursdays; noon - 2 p.m.
Eastern Location: Your Office Format: Online
Advanced Development Practices is a sequel to the Essentials of the Development Process and
builds on the concept of a Development Matrix where the seven stages of Real Estate
Development are combined with the eight Tasks required in each stage to produce a 56-cell
matrix.
This survey course focuses on the eight Tasks in each stage of the real estate development
process. Each Task is really a category of tasks that must be completed in order to create value
throughout the development process. Each Stage of Development begins with the Acquisition
Task and ends with the Disposition Task. In between, the developer must address and complete
the following Tasks: Finance, Market Studies and Marketing Strategy, Environmental, Approvals
and Permits, Improvements, and Transportation and Accessibility. In reality these Tasks are
completed in various orders and usually they are done simultaneously. The order of the Tasks
presented in this course is arbitrary, and most tasks interact with each other to some extent and
the completion of individual task is dependent on the completion of other Tasks. This course
broadly describes the Tasks and the sub-tasks from a developers point of view. Students are not
expected to be experts in all of these tasks, but they are expected to understand and appreciate
what needs to happen for a successful development, i.e. one that creates value in excess of the
costs needed to create value.
Course Objectives
Course Objectives
Define and explain the eight sets of tasks that are required in each stage of
development.
Define and explain at least two sub-tasks in each major task set.
Understand why each task must be address even if the developer decides to
undertake multiple stages of development.
November 3, 2016
Market Studies and Marketing Strategies
Understand the natural tension that exists between approvals, permits, and
various agencies.
Understand that the approval process is complex, with numerous agents and
agencies.
List and define the various types of approvals and permits needed at the
federal, regional, state, local, and private level.
December 1, 2016
Improvements
Engineer
Construct
Maintain
December 8, 2016
Transportation and Accessibility
Articulate how a developer gets paid using various payment and financing
structures
This module discusses the disposition tasks that include the sellers due diligence, sales
contracts, pre- and post-closing conditions, and seller-financing opportunities. Various sales
contracts are presented, with a discussion of strategies using two class exercises.
Learning Objectives and Outcomes
Learning Objectives
Learning Objectives
Recognize the role of participants of the public and private real estate capital
markets and define the types of real estate financed by the real estate capital
markets.
Identify the sources and types of financing for real estate investments and
apply the major indices which measure real estate investment returns and
risk over time
Define the investment strategies followed by investors and the required rates
of return for each these strategies and discern the components of the
expected total return on a real estate investment
Learn how to deal with changes in project risk over time and determine the
factors that drive the phasing and inventory decision for a multi- or mixeduse investment
Understand how land can be viewed as an option and how to use this to value
land
Determine how to assess the risk exposure and identify the assumptions
which must be made in the process of recommending a risk management
solution
January 7, 2016
Overview of the Real Estate Capital Markets: Investment Strategies, Return
Measurement and Risk
comprehensive understanding of the sources and types of financing for real estate investments in
addition to knowing the major indices which measure real estate investment returns and risk over
time. We will identify the investment strategies followed by investors and the required rates of
return for each these strategies. Students will learn to discern the components of the expected
total return on a real estate investment. Lastly, we will view some of the industry data sources for
cap rates and required returns and learn how to measure return on real estate investments.
markets and examine the types of real estate financed by the real estate capital markets.
Students will gain a comprehensive understanding of the sources and types of financing for real
estate investments in addition to knowing the major indices which measure real estate investment
returns and risk over time. We will identify the investment strategies followed by investors and
the required rates of return for each these strategies. Students will learn to discern the
components of the expected total return on a real estate investment. Lastly, we will view some of
the industry data sources for cap rates and required returns and learn how to measure return on
real estate investments.
anuary 14, 2016
Investment Analysis for Value-Added Properties: Case Study/Exercise 1: Office
Project
The Site Feasibility and Market Analysis course is designed for the intermediate experiencedlevel real estate professional. The course starts with an analysis of macro- economics that drive
and support the demand for real estate development. Students explore how to navigate through
the capital considerations of a project to include the cost and availability of financing. The
underlying contributors to supply, what drives the demand for development and the potential
political, legal and regulatory challenges are also examined. As the site feasibility study process
continues, each of the due diligence check points are defined and examined. Once the research
process leads to consideration of a specific site, learners will identify and analyze the physical
attributes, environmental considerations and potential issues with the project.
This is an edited version of a previously recorded, live, online course. Student and instructor
comments are the opinions of the individuals and do not necessarily reflect the views of NAIOP.
All handouts and resource materials are posted along with the module to which they belong with
an evaluation and assessment at the end of the course.
Learning Objectives
Learning Objectives
Define the due diligence process and the intended outcome. Identify the
critical players in the process. Develop a plan to work within the budget and
timeframe of the project.
Conduct simple highest and best use analysis taking into consideration:
valuation using direct capitalization approach, land use controls and
insurability.
Recognize the critical components of a site analysis and the impact of the
results to the success or potential risks to the project.
Module 1
Overview and Market Analysis - Defining the Problem
In this session we will discuss the first step in the Feasibility Study Process: Defining the
Problem. We will cover property analysis, site analysis checklist, and location analysis.
Module 2
Market Analysis
utility, desire, scarcity, and effective purchasing power. Groups will also present results from the
assigned case study.
Module 6
Due Diligence