Advanced Real Estate Advanced Real Estate Finance and DevelopmentFinance and Development

GSD 5303GSD 5303

Richard Peiser Richard Peiser

Frank ApesecheFrank Apeseche

Course objectiveCourse objective

This course is a second-level class for This course is a second-level class for students who want to learn about more students who want to learn about more advanced topics in real estate finance and advanced topics in real estate finance and development.development.

The course builds on GSD 5204 (Real The course builds on GSD 5204 (Real Estate Development and Finance) and Estate Development and Finance) and other similar first-courses in real estate at other similar first-courses in real estate at HBS and MIT.HBS and MIT.

Students should have a good working Students should have a good working knowledge of basic real estate analysis, knowledge of basic real estate analysis, terminology, and concepts of DCF, IRRs, terminology, and concepts of DCF, IRRs, etc.etc.

Course TopicsCourse Topics

Advanced financial analysis and deal structuring Advanced financial analysis and deal structuring for land and building developmentfor land and building development

Debt and equity capital – how to structure a Debt and equity capital – how to structure a capital proposal and where to go for different capital proposal and where to go for different types of equitytypes of equity

REITS, public real estate markets, and market REITS, public real estate markets, and market cyclescycles

Buying distressed debt and non-performing Buying distressed debt and non-performing loans with emphasis on Asian capital markets. loans with emphasis on Asian capital markets.

Richard PeiserRichard Peiser

How to analyze investment returns and How to analyze investment returns and structure development deals.structure development deals.

Richard Peiser is the Michael D. Spear Richard Peiser is the Michael D. Spear Professor of Real Estate Development at Professor of Real Estate Development at Harvard Design School.Harvard Design School.

Frank ApesecheFrank Apeseche

Over 25 years leading Real Estate Over 25 years leading Real Estate Businesses:Businesses:1.1.14 Discretionary Funds, $7B Capitalization14 Discretionary Funds, $7B Capitalization2.2.3 Public NYSE Real Estate Companies3 Public NYSE Real Estate Companies3.3.National Multifamily Real Estate Advisor: National Multifamily Real Estate Advisor: 1,000 employees, $5B in assets1,000 employees, $5B in assets4.4.Nation’s largest multifamily GSE LenderNation’s largest multifamily GSE Lender5.5.Venture Capital Investment Firm focused Venture Capital Investment Firm focused on RE entity level investingon RE entity level investing

TopicsTopics

Land and Community DevelopmentLand and Community Development Small scale to new townsSmall scale to new towns Financial Analytical TechniquesFinancial Analytical Techniques

Income Property DevelopmentIncome Property Development Office, Residential, Retail, IndustrialOffice, Residential, Retail, Industrial 5 stages of analysis – Combined 5 stages of analysis – Combined

Development Period/Operating Period Development Period/Operating Period Financial AnalysisFinancial Analysis

J/Vs and institutional deal structuresJ/Vs and institutional deal structures Asset allocation and international fund Asset allocation and international fund

underwritingunderwriting Non-Performing Loans and investing in Non-Performing Loans and investing in

distressed debtdistressed debt SecuritizationSecuritization REITsREITs Strategic decision-makingStrategic decision-making

TopicsTopics

Section will cover the essentials for Section will cover the essentials for successfully starting, building and successfully starting, building and managing Real Estate Enterprisesmanaging Real Estate Enterprises

TopicsTopics

Sequenced to build strong foundational Sequenced to build strong foundational understanding of concepts around understanding of concepts around starting, managing and leading a real starting, managing and leading a real estate companyestate company

Optimizing analysis and decision making at Optimizing analysis and decision making at asset levelasset levelStrategic construction of RE portfoliosStrategic construction of RE portfoliosCapitalizing Real Estate portfoliosCapitalizing Real Estate portfolios

Capitalizing Real Estate CompaniesCapitalizing Real Estate Companies Underwriting Real Estate SponsorsUnderwriting Real Estate Sponsors Managing the EnterpriseManaging the Enterprise Optimizing the Enterprise: Leveraging Optimizing the Enterprise: Leveraging

Strategy, Talent and CapitalStrategy, Talent and Capital Start up considerations Start up considerations

Use of cases, lectures and Use of cases, lectures and problems sets geared problems sets geared towardstowards

Evaluating risk adjusted returns of real Evaluating risk adjusted returns of real estate asset opportunitiesestate asset opportunities

Constructing investment strategies for Constructing investment strategies for markets and cyclesmarkets and cycles

Accessing public and private capitalAccessing public and private capital

Managing and serving investors Managing and serving investors leading a businessleading a businessOptimizing long term entity Optimizing long term entity

successsuccessEvaluating career and Evaluating career and

employment opportunitiesemployment opportunities

GuestsGuests

Charles Lowrey –      Charles F. Lowrey is Charles Lowrey –      Charles F. Lowrey is executive vice president and chief operating executive vice president and chief operating officer of Prudential’s U.S.-based officer of Prudential’s U.S.-based businesses, comprising Prudential businesses, comprising Prudential Investment Management, Prudential Investment Management, Prudential Retirement, Prudential Annuities, Individual Retirement, Prudential Annuities, Individual Life Insurance and Group Insurance, which Life Insurance and Group Insurance, which together had approximately $877 billion in together had approximately $877 billion in assets under management as of September assets under management as of September 30, 2012.30, 2012.

Richard Georgi –Richard Georgi –Global Managing Partner for Grove International Partners which is a spin-out of Soros Real Estate Partners, a firm he founded with George Soros in 1999.

Michael Lander – CEO of the Lander Michael Lander – CEO of the Lander Group, a developer of residential, retail, Group, a developer of residential, retail, and mixed-use projects based in and mixed-use projects based in Minneapolis, Minn.Minneapolis, Minn.

Jack Rodman – Jack Rodman – past managing partner of past managing partner of Ernst & Young’s Beijing office and head of Ernst Ernst & Young’s Beijing office and head of Ernst & Young’s distressed debt practice worldwide. & Young’s distressed debt practice worldwide. He has served as Financial Advisor to the He has served as Financial Advisor to the governments of Japan and China for dealing governments of Japan and China for dealing with their non-performing loans.with their non-performing loans.

Major AssignmentMajor Assignment

The term project will constitute the major The term project will constitute the major part of the grade along with occasional part of the grade along with occasional homework assignments and quizzeshomework assignments and quizzes

Each student will select either Frank Each student will select either Frank Apeseche or Richard Peiser to work with Apeseche or Richard Peiser to work with on his/her Term Projecton his/her Term Project

MDES students may use the term project MDES students may use the term project in partial fulfillment of their scholarly paper in partial fulfillment of their scholarly paper requirementrequirement

ClassesClasses

Monday and Wednesday afternoons 3:30-Monday and Wednesday afternoons 3:30-5:005:00

Case instruction method supplemented by Case instruction method supplemented by lectureslectures

Optional site visit to major Boston area Optional site visit to major Boston area development projectdevelopment project