Financial Analysis of Development Projects (Site1)

Financial Analysis of the Development Process

Financial Analysis of Development Projects

The Financial Analysis of Development Projects course provides a combination of analytical theory and practical tools needed to evaluate the financial feasibility of complex value added and opportunistic real estate investments. This includes speculative land, land development, and commercial and residential rehabilitation and development for all property types: office, industrial, retail, multi-family and mixed-use. Accounting, risk management, taxation, capital markets and organizational issues influencing the financial viability of these real estate projects will also be considered and discussed. It is designed as an introductory to intermediate experience level course. Class sessions are primarily lecture type with substantial participation and discussion expected from the students. Outside speakers, group activities, case studies and exercises will be utilized to reinforce and apply the concepts. Assessments are designed in such a way as to measure student knowledge of content.

Lesson Plans

May 14, 2014

Overview of the Real Estate Capital Markets: Investment Strategies, Return Measurement and Risk

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

In this session, we'll identify participants in the public and private real estate capital 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. 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.

Facilitator for this Lesson:
Jerry Franke

Jerry Franke

President

WISPARK LLC

Milwaukee, Wis.

Subject Area: Advanced Real Estate Finance, Financial Analysis of Development Projects

Jerold Franke was named president of WISPARK LLC., the real estate development subsidiary of Wisconsin Energy Corp., in August 2000. In this role, Franke has executive responsibility over the full-service, real estate development company that plans and constructs master-planned business parks in southeast Wisconsin and northeast Illinois.

Franke began his career with WISPARK in 1988 as director - Business Development. He quickly advanced to vice president in 1989 and was subsequently named senior vice president in 1998. Prior to joining WISPARK LLC., Franke was vice president for economic development of Forward Wisconsin, Inc., the state's economic development marketing organization from 1987 to 1988. Previously he was acting city manager and director of community development for the city of Janesville, Wisc., from 1980 to 1987.

May 21, 2014

Investment Analysis for Value-Added Properties: Case Study/Exercise 1: Office Project

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

Students will develop skills to identify and analyze value-added investment opportunities. In doing so, we will review key metrics, data points and structural issues used when evaluating value-added investments from both a debt and equity viewpoint.

Facilitator for this Lesson:
James T. Neyer

James T. Neyer

EVP, Real Estate Development

Al. Neyer, Inc.

Cincinnati, Ohio

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

Jim Neyer leads Al. Neyer's real estate development activities with a balanced focus on market driven investment. He has more than 25 years experience in commercial real estate, development, financing and construction. He is a principal and a member of the Al. Neyer Executive Team and has the hands-on expertise and strategic perspective to drive results for Al. Neyer and its investor partners. Neyer serves as a faculty member for NAIOP's Center for Education.

In addition to his work with NAIOP Corporate and NAIOP Cincinnati/Northern Kentucky, he is involved with Downtown Cincinnati, Inc. and several other professional and community organizations. Neyer received his Bachelor of Science degree in civil engineering from Marquette University.

May 28, 2014

Investment Analysis for Development Transactions; Case Study/ Exercise 2: Industrial Project; Case Study/Exercise 3: Sale of a Residential Condo Project

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

This session will provide a thorough overview of financing and investing in development. We will discuss the complexities of valuing and assessing development projects and identify the differences between valuing a for-sale versus a for-rent development project. Students will learn how to deal with changes in project risk over time and how to determine the appropriate equity return for a development project. Finally, students will complete two case studies: one evaluating a for-rent development and the other a for-sale development.

Facilitator for this Lesson:
James T. Neyer

James T. Neyer

EVP, Real Estate Development

Al. Neyer, Inc.

Cincinnati, Ohio

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

Jim Neyer leads Al. Neyer's real estate development activities with a balanced focus on market driven investment. He has more than 25 years experience in commercial real estate, development, financing and construction. He is a principal and a member of the Al. Neyer Executive Team and has the hands-on expertise and strategic perspective to drive results for Al. Neyer and its investor partners. Neyer serves as a faculty member for NAIOP's Center for Education.

In addition to his work with NAIOP Corporate and NAIOP Cincinnati/Northern Kentucky, he is involved with Downtown Cincinnati, Inc. and several other professional and community organizations. Neyer received his Bachelor of Science degree in civil engineering from Marquette University.

June 11, 2014

Financial Analysis of Mixed and Multi-Use Development; Case Study/Exercise 4: Mixed-Use Development Analysis (includes: retail, office and multifamily)

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

We will focus on financing and investing in a mixed-use development during this session. We'll discuss the complexities and nuances involved in mixed-use development projects and identify the factors that drive the phasing and inventory decision for a multi- or mixed-use investment. The session concludes with completion of a case study/exercise evaluating a mixed-use development.

Facilitator for this Lesson:
William Klein

William L. Klein

President

Kay Realty Services LLC

Ocean, New Jersey

Subject Area: Essentials of the Development Process, Advanced Development Practices, Leasing, Marketing and Negotiations, Site Feasibility and Financial Analysis of Development Projects

William Klein has been a recognized leader in all facets of real estate investment for more than 40 years. He has participated in numerous transactions, (many as a managing principal), in all asset classes in the industry. Since 1994, Klein has been the CEO of Kay Realty Services., one of the New Jersey shore's innovative real estate investment firms, which he founded on a theme of "value-added" strategies. He acts as managing member of all Kay Realty Holdings assets. He is also CEO of Smitty's Super Foodtown Stores, a 2 store supermarket which anchors two of his shopping centers.

Prior to KAY REALTY, Klein held key senior management positions in several national and regional development firms such as K Hovnanian and Dyson Kissner Moran where he created over three million sf of class A properties. Earlier, he served as chief appraiser of Central Savings Bank of New York and a senior executive and leader of Joint Ventures in the Home Life Insurance Company's mortgage investment division.

Klein holds a bachelors degree in economics from Upsala College and has completed professional graduate courses in real estate at Harvard University Graduate School of Design, Rutgers University and New York University. His appraisal training was provided by the American appraisal institute (MAI). He is a licensed broker in the state of New Jersey.

June 18, 2014

Investment in Land for Future Development; Case Study/Exercise 5: Analysis of a Land Investment

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

We will focus on financing and investing in a mixed-use development during this session. We'll discuss the complexities and nuances involved in mixed-use development projects and identify the factors that drive the phasing and inventory decision for a multi- or mixed-use investment. The session concludes with completion of a case study/exercise evaluating a mixed-use development.

Facilitator for this Lesson:
Curtis Spencer

Curtis D. Spencer

President

IMS Worldwide, Inc.

Webster, Texas

Subject Area: Essentials of the Development Process, Advanced Development Practices, Site Feasibility, Site Analysis and Development Fundamentals (Chapter Education Partnership)

Mr. Curtis D. Spencer is the President of IMS Worldwide, Inc. (IMSW), headquartered in Houston, Texas. Mr. Spencer is a nationally regarded expert on matters related to: Logistics and intermodal shipping trends, ports, inland ports and rail-served logistics centers; the development and utilization of Foreign-Trade Zones for importers and exporters; all aspects of Custom's issues and compliance, specifically those related to Homeland Security.

Mr. Spencer is featured as a speaker at more than 50 national conferences and workshops each year, and has been published in the The Journal of Commerce, Pacific Shipper, Inbound Logistics and other newsmagazines. Mr. Spencer has been the keynote or featured speaker at annual events sponsored by the following associations: IWLA, RILA, JOC, ULI, NAIOP, SIOR, AAEI, NAFTZ, AAAE, CSCMP, WERC, and ICSC.

Mr. Spencer has recently completed his term on the 9th and 10th COAC Committee, with oversight responsibilities on Customs and the Department of Homeland Security. IMS Worldwide, under Mr. Spencer's leadership, is now a leading consulting firm for developers and real estate trusts who seek his guidance as it relates to property value, port efficiencies and site selection differentiators.

 

June 25, 2014

Real Estate Development Deal Structuring and Underwriting; Case Study/Exercise 6: Modeling Joint Venture and Partnership Profit Sharing and Partitioned Returns

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

In this session, we will examine the sources of equity financing and discuss the organizational forms and joint ventures for value added and opportunistic real estate investments. We will define terms associated with private equity arrangements and discuss the investment strategies pursued by private equity. Students will learn to analyze the fees structures of private equity investment vehicles and comprehend the workings of joint ventures, in addition to understanding common deal structures for private equity joint venture and partnerships with profit sharing and partitioned returns. We'll explore the commercial mortgage capital markets in terms of lenders, mortgage types and terms. We'll review the contents of a loan submission package and development and value-added loan underwriting guidelines and discuss how lenders make decisions on financing these properties. Finally, students will work through a case study/exercise detailing a private equity joint venture deal structure with profit sharing and partitioned returns.

Facilitator for this Lesson:
Jaime Northam

Jaime Northam

Director of Business Development

Greater Phoenix Economic Council

Phoenix, Ariz.

Subject Area:

Jaime Northam, Director of Business Development, focuses on providing site selection services and real estate guidance across several key industries. Northam teams with national site selectors, real estate professionals and out-of-state companies in the comprehensive evaluation and decision-making of business relocation and/or expansion into the Greater Phoenix area. She primarily works with companies in the high-tech manufacturing, general manufacturing, logistics/distribution, healthcare and biotech industries.

Northam comes from a well-rounded commercial real estate background that includes 13 years of experience in market research, industrial brokerage, office and industrial development, office leasing and healthcare real estate asset management. Prior to joining GPEC, Northam served as Regional Asset Manager for Healthcare Trust of America’s (HTA) Midwest US portfolio of medical office buildings, valued at $165 million and distributed between five states. In this role, she oversaw the leasing, operations, capital investment and overall financial performance of her portfolio. Before HTA, Northam worked at The Alter Group as its Vice President of Real Estate for the Southwest Region and, prior to that, was in industrial brokerage at Grubb &Ellis|BRE Commercial.  In the earlier years of her career, she managed the industrial and office sectors of Grubb &Ellis|BRE Commercial’s research department.

Northam is a Phoenix native and attended the University of Arizona, where she acquired a Bachelor’s degree in Communications. She sits on the St. Joseph’s Hospital Foundation Board of Directors; is a member of Arizona Association of Economic Development; and has been a member of NAIOP since 2003. She helped launch NAIOP’s award-winning local Developing Leader program and currently sits on the AZ Chapter’s Board of Directors.  On a national level, she sits on the Chapter Relations and Membership Committee and has been a member of one of the elite national forums for 5 years (Trends in Real Estate Development III). She was awarded the “National Developing Leader of the Year” award by NAIOP in 2010 and was selected in 2009 by Real Estate Forum magazine as one of 50 women across the nation to receive their “Women of Influence” designation. Northam has also been featured in the Phoenix Business Journal, AZRE Magazine and NAIOP’s Development Magazine.

July 9, 2014

Accounting and Taxation issues for Real Estate Development Projects

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

This session will cover the various tax classifications and exemptions imposed on real estate in addition to addressing accounting and tax issues for development projects. We will explore affordable housing programs and discuss the Low Income Housing Tax Credit (LIHTC). Other tax incentives and programs that affect development will also be examined.

Facilitator for this Lesson:
Gregory Allen

Allen Gregory

Partner

Eide Bailly, LLP

Golden, Colorado

Subject Area:

Allen Gregory is a partner of Eide Bailly, a top 25 CPA firm. With 25+ years of public accounting experience, he provides tax planning from formation to liquidation with flow-through entity taxation, and specializes in evaluating fixed asset capitalization procedures through cost segregation studies for newly constructed, renovated and acquired real estate. Mr. Gregory received a bachelor’s degree in Business Administration from Kent State University and a Masters of Taxation from the University of Denver.

July 16, 2014

Risk Management for Real Estate Development Projects

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

The final course session will focus on risk management. We will identify and pinpoint risk exposures during the development process as a problem to be solved with a risk management solution. Students will gain a better understanding of the principal risk exposures in real estate development and how to assess the risk exposure and identify the assumptions which must be made in the process of recommending a risk management solution. We will discuss the differences between insurable versus uninsurable risks and address how insurable risk exposures and theoretical concepts of risk affect insurance policy design, coverage and contractual provisions.

Facilitator for this Lesson:
Dave Domres

Dave Domres, CPM® CCIM

Senior Vice President

Siegel-Gallagher Management Company

Milwaukee, Wis.

Subject Area: Financial Analysis of Development Projects

In his 30 year career, David Domres CPM® CCIM has been involved in virtually every aspect of real estate investment, management and development in numerous capacities including Asset and Property Manager for office, medical, corporate, retail, industrial and multi-family properties.   Individual property portfolios have totalled more than 30 million square feet of commercial space and 5,000 apartment units. David is a Certified Property Manager®, Certified Commercial Investment Member and a frequent speaker, instructor and author on real estate strategy, investment, management, financial analysis and property performance.

David's extensive career experience includes service to individuals, corporations and full service real estate companies. David is well respected for his innovation, attention to detail, implementation and professionalism with asset, property and facility management, capital project planning and implementation, investment and leasing transactions, strategic planning and forecasting.  His passion goes beyond the workplace to support real estate in the community as the past President of numerous professional real estate associations including 2008 NAIOP Wisconsin Chapter President, NAIOP Corporate Board member from 2010 – 2012, 2013 NAIOP National Volunteer of the Year Award and being recognized three times as CPM of the Year by the Milwaukee Chapter of the Institute of Real Estate Management and 2012 IREM Professional Achievement Award


Education Credits

Education Credits

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Financial Analysis of Development Projects is approved for the following Education Credit:
16 hours credit toward either the Certificate of Advanced Study in Commercial Real Estate Development or the Certificate of Advanced Study in Real Estate Finance.

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

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
  • Know how to measure return on real estate investments
  • Understand the complexities of valuing and assessing development projects and learn the difference between valuing a for-sale vs. a for-rent development project
  • 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 mixed-use investment
  • Understand how land can be viewed as an option and how to use this to value land
  • Demonstrate knowledge of the various tax classifications and exemptions imposed on real estate
  • Determine how to assess the risk exposure and identify the assumptions which must be made in the process of recommending a risk management solution
  • Define terms associated with a private equity arrangements and understand the investment strategies pursued by private equity

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 April 23, 2014 will be charged a fee of $100 per attendee. Cancellations received after May 7, 2014, will forfeit the registration fee. No refunds will be made for no-shows. Substitutions are permitted until May 7, 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.