URP 591 is designed to provide practical, real-world tools to prepare students for a career in commercial real estate. The class goal will be to learn how to analyze commercial deals from acquisition to disposition and everything in between (syndicating, budgeting, evaluating lease proposals, financing, refinancing, dealing with capital issues and tenant improvement costs, selling, holding, etc.). The entire course will be taught through documents from real transactions posted in Canvas. No course textbook will be used. URP 591 will focus on office, retail, and industrial real estate financial analysis. Several moderated guest speakers are scheduled for the class including a syndicator of real estate to discuss the capital stack, an appraiser, and a lender/mortgage banker. We will also visit a local commercial real estate deal to get hands-on experience. Topics to be discussed include:
- Dissecting The Components of Net Operating Income
- Capitalization Rates, Cash on Cash Returns, IRRs, etc.
- Lease Types (Gross, Net, Triple Net, Modified Gross, etc.)
- Reviewing Title, Boundary Surveys, Environmental Reports and Capital Studies
- Review of Different Types of Commercial Financing (Acquisition, Refinancing, Mezzanine, Funding Lease Deals and Capital Issues, etc.)
- Excel And Argus Real Estate Modeling
- Finding Investors and Organizing the Capital Stack for Acquisitions
- Introduction To Costar
At various stages of the class, we will look at actual commercial deals for sale as case studies to build upon the knowledge you are gaining in class.
The bulk of the class grade will be based on a group case project analyzing a commercial real estate deal starting with its acquisition, continuing through repositioning it, and ultimately selling or holding it. The balance of the grade will be based on active class participation. There will be no exams in the class. At the end of the class, we hope you will look at commercial real estate deals critically and from a different viewpoint than when you started the class.
