Basic Real Estate Finance (Fin1)

Basic Real Estate Finance

Basic Real Estate Finance

Basic Real Estate Finance is designed to provide entry level professionals with the skills necessary to analyze the financial feasibility of real estate investment opportunities. It provides a step-by-step approach for completing a financial feasibility analysis. Students will become more familiar with real estate market participants, valuation fundamentals, determinants of real estate returns, the impact of leverage on real estate investments, and interactions between the real estate space market and the capital market. This course is ideal for developers, asset managers and owners who have very little financial analysis experience. It will therefore emphasize fundamentals and will not delve into more complex issues that are covered in NAIOP's Advanced Real Estate Finance course.

Lesson Plans

January 15, 2014

Introduction to Space Markets and Capital Markets

Time: noon - 2 p.m. (Eastern Standard Time)

This session focuses on the relationship between the space market and the capital market, which will be used as a framework for the entire course. We'll also discuss why real estate is a unique asset class and identify major property types and classifications along with key real estate investors. In addition, this session will introduce the four quadrants of the capital market, discuss investment strategies and examine historic real estate returns.

Facilitator for this Lesson:
Gregg Boehm

Gregg Boehm

Vice President

Industrial Income Trust

Newport Beach, Calif.

Subject Area: Essentials of the Development Process, Advanced Development Practices, Basic and Advanced Real Estate Finance, Leasing, Marketing and Negotiations and Site Feasibility

Gregg Boehm is vice president for Industrial Income Trust. Previously, he was director of acquisitions for the Watson Land Company, headquartered in Carson, Calif. Mr. Boehm received a bachelor's degree in Urban Planning & Development and Public Administration from the University of Southern California in 1995 and received his MBA from the University of California at Irvine in 2006.

January 22, 2014

Real Estate Valuation Using Direct Capitalization

Time: noon - 2 p.m. (Eastern Standard Time)

This section will focus on the basic structure of a real estate operating statement and how capitalization rates are used in conjunction with the operating statement to derive an estimate of value.

Facilitator for this Lesson:
Charles Tu

Charles C. Tu, PhD, CFA

Daniel F. Mulvihill Professor of Commercial Real Estate & Academic Director of MSRE Program

University of San Diego

San Diego, CA

Subject Area:

Charles Tu is the Daniel F. Mulvihill Professor of Commercial Real Estate and Academic Director of the MS in Real Estate program in the Burnham-Moores Center for Real Estate at the University of San Diego. He teaches a variety of courses at both the graduate and undergraduate levels, including real estate finance and investment, real estate capital markets, real estate management, and real estate development.  He is also the principal instructor of Advanced Real Estate Finance in Urban Land Institute’s Real Estate School.  Tu earned his PhD in business administration from The George Washington University in 1999 and received the Chartered Financial Analyst (CFA) designation in 2000.  He became a LEED Accredited Professional in 2009 and is ARGUS Software Certified for both ARGUS Valuation-DCF and Developer.

January 29, 2014

Real Estate Valuation Using Discounted Cash Flow Analysis

Time: noon - 2 p.m. (Eastern Standard Time)

In this section, we will differentiate discounted cash flow analysis from direct capitalization when the technique is presented to provide students with a clear understanding of the relationship between the two approaches to valuation.

Facilitator for this Lesson:
Jim Clayton

Jim Clayton

Vice President, Research

Cornerstone Real Estate Advisers, LLC

Subject Area:

Jim Clayton is Vice-President of Research at Cornerstone Real Estate Advisers LLC, a Hartford CT based global real estate investment adviser with affiliate and subsidiary offices in the US, UK, Europe and Asia. At Cornerstone, Jim is responsible for monitoring and forecasting real estate and capital market trends and delivering applied research and strategic thought pieces to the firm’s leadership and investor clients. Prior to joining Cornerstone in December 2008, he was the Director of Research at the Pension Real Estate Association (PREA). Before joining PREA in 2006, Jim held faculty positions at the University of Cincinnati and Saint Mary’s University (in Halifax, Nova Scotia). He is currently an Adjunct Professor in the Real Estate Program in the School of Business at the University of Connecticut and also teaches in executive education programs at the Real Property Association of Canada (REALpac). 

Jim is a Fellow of the Real Estate Research Institute (RERI), a Fellow of the Weimer School of Advanced Studies in Real Estate and Land Economics and a past recipient of a Homer-Hoyt Institute post-doctoral fellowship. He is active in a number of industry groups and is a frequent presenter at both industry and academic events in North America and abroad. Jim has an undergraduate degree in Economics from Queen’s University, an MA degree in Economics from the University of Western Ontario and a Ph.D. degree in Real Estate Finance and Urban Economics from the University of British Columbia.

February 5, 2014

Real Estate Leases

Time: noon - 2 p.m. (Eastern Standard Time)

This section will cover the legal aspects of real estate leases and focus on how each type of lease structure influences cash flow/value.

Facilitator for this Lesson:
Dan R. Levitt

Daniel R. Levitt

Senior Vice President Capital Markets

Ryan Companies US, Inc.

Minneapolis, Minn.

Subject Area:

Dan Levitt brings more than 25 years of real estate experience and capital investment expertise to his role as senior vice president Capital Markets at Ryan Companies US, Inc. His work includes the analysis, origination and structuring of debt, equity and joint ventures as well as directing the funding process from inception to closing. Over the last five years, Mr. Levitt's capital markets team has managed dispositions, financings, acquisitions and joint ventures valued at more than $2 billion. He oversees capital transactions in all of Ryan’s geographic markets, focusing on Ryan's many property types. Mr. Levitt's team works closely with other Ryan service leaders to develop creative solutions for their customers and investors. He is well respected for his thoroughness, clarity, problem-solving and presentation skills.

February 12, 2014

Determinants of Real Estate Returns

Time: noon - 2 p.m. (Eastern Standard Time)

Capitalization rates and discount rates will be broken down into their component parts to help students estimate potential changes in the rates over time.

Facilitator for this Lesson:
Thomas G. Thibodeau

Thomas G. Thibodeau, Ph.D.

Global Real Estate Capital Markets Professor

University of Colorado Boulder

Boulder, Colorado

Subject Area: Basic and Advanced Real Estate Finance, Real Estate Capital Markets, and Financial Analysis of Development Projects

Dr. Thomas Thibodeau is the Global Real Estate Capital Markets Professor and the Academic Director of the CU Real Estate Center in the Leeds School of Business at the University of Colorado-Boulder. He is currently teaching Real Estate Finance and Investments and Real Estate Economics in the MBA Program at Leeds. He has taught courses in real estate fundamentals, real estate markets and valuation, real estate development, commercial mortgage backed securities, managerial economics and macroeconomics.

February 19, 2014

Introduction to Debt Financing

Time: noon - 2 p.m. (Eastern Standard Time)

This session will emphasize mortgage terminology and basic skills such as calculating mortgage payments and balances in this module. We'll also discuss the relationship between leverage and investment risk.

Facilitator for this Lesson:
Jim Clayton

Jim Clayton

Vice President, Research

Cornerstone Real Estate Advisers, LLC

Subject Area:

Jim Clayton is Vice-President of Research at Cornerstone Real Estate Advisers LLC, a Hartford CT based global real estate investment adviser with affiliate and subsidiary offices in the US, UK, Europe and Asia. At Cornerstone, Jim is responsible for monitoring and forecasting real estate and capital market trends and delivering applied research and strategic thought pieces to the firm’s leadership and investor clients. Prior to joining Cornerstone in December 2008, he was the Director of Research at the Pension Real Estate Association (PREA). Before joining PREA in 2006, Jim held faculty positions at the University of Cincinnati and Saint Mary’s University (in Halifax, Nova Scotia). He is currently an Adjunct Professor in the Real Estate Program in the School of Business at the University of Connecticut and also teaches in executive education programs at the Real Property Association of Canada (REALpac). 

Jim is a Fellow of the Real Estate Research Institute (RERI), a Fellow of the Weimer School of Advanced Studies in Real Estate and Land Economics and a past recipient of a Homer-Hoyt Institute post-doctoral fellowship. He is active in a number of industry groups and is a frequent presenter at both industry and academic events in North America and abroad. Jim has an undergraduate degree in Economics from Queen’s University, an MA degree in Economics from the University of Western Ontario and a Ph.D. degree in Real Estate Finance and Urban Economics from the University of British Columbia.

February 26, 2014

Leveraged Real Estate Investments

Time: noon - 2 p.m. (Eastern Standard Time)

Leverage is incorporated into the reconstructed operating statement in this section to analyze the financial performance of a real estate investment.

March 5, 2014

Analyzing Debt Financing Options

Time: noon - 2 p.m. (Eastern Standard Time)

We'll discuss the skills necessary to estimate the maximum loan amount a property will support and to choose between financing options with different terms.

Facilitator for this Lesson:
Charles Tu

Charles C. Tu, PhD, CFA

Daniel F. Mulvihill Professor of Commercial Real Estate & Academic Director of MSRE Program

University of San Diego

San Diego, CA

Subject Area:

Charles Tu is the Daniel F. Mulvihill Professor of Commercial Real Estate and Academic Director of the MS in Real Estate program in the Burnham-Moores Center for Real Estate at the University of San Diego. He teaches a variety of courses at both the graduate and undergraduate levels, including real estate finance and investment, real estate capital markets, real estate management, and real estate development.  He is also the principal instructor of Advanced Real Estate Finance in Urban Land Institute’s Real Estate School.  Tu earned his PhD in business administration from The George Washington University in 1999 and received the Chartered Financial Analyst (CFA) designation in 2000.  He became a LEED Accredited Professional in 2009 and is ARGUS Software Certified for both ARGUS Valuation-DCF and Developer.

Education Credits

Education Credits

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Basic Real Estate Finance is approved for the following Education Credit:
16 hours credit toward the Certificate of Advanced Study in Commercial Real Estate Development.

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16 AIA/CES Learning Units
16 Professional Development Hours (PDH)
1.6 Continuing Education Units (CEUs)

Learning Objectives

Learning Objectives

  • Defining "space markets" and "capital markets"
  • Identifying the four quadrants of the capital market
  • Developing an operating statement
  • Understanding capitalization rates
  • Differentiating capitalization rates from total yield
  • Defining and calculating net present value (NPV)
  • Defining and calculating unlevered internal rate of return (RR)
  • Differentiating between gross leases and net leases
  • Incorporating tenant reimbursements into the operating statement
  • Identifying the factors that cause capitalization rates and discount rates to change over time
  • Identifying sources of discount rate and capitalization rate data
  • Examining the relationship between leverage and risk
  • Calculating loan payments and loan balance

Tuition & Register

Tuition & Register

Payment for a NAIOP online course entitles access for one person only to the course and all materials.

Course Tuition

Member

$795

Non-member  

$995

Developing Leader

$595

Student Member

$95

Student Non-Member

$145

How to Register

  • Register online
  • Fax: Complete the PDF form and fax to 703-904-7003
  • Mail: Send check payments to: P.O. Box 333354, Chantilly, VA 20153
  • Register over the phone/questions: 800-666-6780

Confirmation

All registrations processed online receive an automatic confirmation. If you register via fax, mail or phone, the confirmation emails will be sent to you after your payment is received and processed. If you do not receive the confirmation emails within two weeks, please contact bell@naiop.org.

Cancellation Policy

All cancellations must be in writing. Cancellations of registrants received after December 26, 2013 will be charged a fee of $100 per attendee. Cancellations received after January 8, 2014, will forfeit the registration fee. No refunds will be made for no-shows. Substitutions are permitted until January 8, 2014. Non-members substituting for members will pay the difference in fees. Please fax all cancellation/substitution notices to (703) 904-7003.

FAQs

FAQs

What does tuition cover?

Payment for a NAIOP online course entitles access for one person only to the course and all materials.

Is there an online instructor?

Yes, there is a live instructor presenting each class. Students are able and encouraged to engage and interact with the instructor and each other.

How much out-of-class work is required for each course?

Courses offered online require no more than one hour per week of additional work outside of the scheduled class times.

What if I miss a scheduled class?

If a student misses a class, all materials and a recording of each class is posted in the material library for the student to review before the next class. A student must attend a minimum of 75 percent of the classes to receive credit.

Do I have to take an exam?

Course exams are not required unless you are enrolled as a candidate for the Certificate of Advanced Study in Commercial Real Estate or the Certificate of Advanced Study in Real Estate Finance.

What records are kept of my coursework?

The Center maintains records of all the coursework you complete, as well as optional exam scores, in a confidential transcript. Transcripts are available to candidates upon request. Please contact education@naiop.org.

What are the computer requirements?

The interactive sessions will be accessed via GoToWebinar.com.

Please use the list below to determine if your computer meets the minimum requirements recommended to participate in the online courses:

To attend on a PC, the following is required:

  • Internet Explorer® 6.0 or newer, Mozilla® Firefox® 2.0 or newer (JavaScript™ and Java™ enabled)
  • Windows® 2000, XP, 2003 Server or Vista
  • Cable modem, DSL or better Internet connection
  • Minimum of Pentium® class 1GHz CPU with 512 MB of RAM (Recommended) (2 GB of RAM for Windows® Vista)

To attend on a Mac®, the following is required:

  • Mac OS X 10.4 (Tiger®) or newer
  • Safari 3.0 or newer, Firefox 2.0 or newer (JavaScript™ and Java™ enabled)
  • Cable modem, DSL or better Internet connection
  • Power PC G4/G5 or Intel processor (521 MB of RAM or better recommended)

Participants wishing to connect to audio using VoIP will need a fast Internet connection, a microphone and speakers (a USB headset is recommended).

Contact Barb David at barbd@naiop.org for more information.