Advanced Real Estate Development and Finance by sG4krvY

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									                                           GSD 5303
                          Advanced Real Estate Finance and Development

Instructor: Professor Richard Peiser

Guest instructors: Frank Apeseche, Glenn Mueller, Richard Georgi and Jack Rodman

Class Time: Mondays 2:00-5:00

This course builds on GSD 5204 and comparable introductory real estate courses offered by other
schools at Harvard. This year’s course covers five main topics: (1) advanced financial analysis and
deal structuring for land, building development and acquisitions, (2) Debt and equity capital – how to
structure a capital proposal and where to go for different types of equity, (3) REITS, public real estate
markets, and market cycles, (4) Buying distressed debt and non-performing loans with emphasis on
Asian capital markets, and (5) Building strategic controls for real estate companies.

The objective of the course is to give students in-depth financial analytical skills for the dominant
forms of real estate financing, fund management, and development. Using case studies and lectures,
the course focuses on advanced real estate finance topics for all major real estate product-types
including apartments, office, retail, industrial, single-family, and land development. The course also
emphasizes financial structuring and key decision-making for all phases of the development process
including site selection, due diligence, design, financing, construction, leasing, operations, and sales.

The course will be team-taught by four faculty, coordinated by Professor Richard Peiser. Each
faculty member is a specialist in the area he is covering in the class. Their course topics, brief
descriptions, and emails for contact purposes are the following:


Richard Peiser (rpeiser@gsd.harvard.edu) –How to analyze investment returns and structure
development deals for income property developments and for land developments. Topics include
land and community development and mixed-use development as well as the 5 stages of income
property analysis. Richard Peiser is the Michael D. Spear Professor of Real Estate Development at
Harvard Design School.
Frank Apeseche (frank.apeseche@berkshire-group.com) – Underwriting acquisitions, raising public
and private capital, designing strategic controls in real estate. Frank Apeseche is CEO of the
Berkshire Group, a real estate, private equity investment institution and sponsor of public and private
real estate companies. Berkshire has sponsored two public REITs, two public operating corporations,
a private buyout of a NYSE REIT, 13 institutional funds and more than fifty real estate partnerships.
Its 1,000 employee multifamily advisor currently owns 30,000 apartment units throughout the United
States.

Glenn Mueller (grmueller@jhu.edu) – Real estate investment trusts, public real estate markets, and
market cycle analysis. Glenn Mueller is professor and Loveland Commercial Endowed Chair of Real
Estate at Colorado State University and a real estate investment strategist with Dividend Capital
Group. He is a prominent REIT analyst and author of numerous academic papers on public and
private real estate market and market cycles.

Richard Georgi (Laura.mollard@groveinvestors.com) is the Global managing Partner of Grove
International Partners, a real estate investment fund. A graduate of Harvard Business School, Richard
Georgi spent nine years with Goldman Sachs, including five as head of the Whitehall Real Estate
Fund in Europe where he oversaw a $5 billion investment program. In 1999, he founded Soros Real

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Estate Partners ("SREP") which then raised a $1 billion fund, Soros Real Estate Investors, C.V.
("SREI"). In 2004, the SREP team spun-out of Soros to create an independent investment advisory
firm named Grove International Partners ("Grove") which subsequently raised a $1.2 billion global
fund, Cypress Grove International ("CGI") with Soros as one of the largest investors. CGI also has a
substantial co-investment fund. CGI has since invested in ten businesses controlling another $5
billion in assets.

Jack Rodman (rodman.china@gmail.com) – Distressed debt and non-performing loans. How to
evaluate non-performing loans. Rodman is managing partner of Ernst & Young’s Beijing office and
head of Ernst & Young’s distressed debt practice worldwide. He has served as Financial Advisor to
the governments of Japan and China for dealing with their non-performing loans.


Readings

Professional Real Estate Development: the ULI Guide to the Business, 2nd Edition, by Richard Peiser,
published by The Urban Land Institute, Washington, D.C., 2003.(PRED)

Articles and case studies assigned by the faculty for each class.



Assignments and Grading
Case studies will be the focus of most class sessions. Students are encouraged to work together in
study groups to prepare the cases for discussion and to perform the analytical computations
emphasized in each case. Each professor may give homework assignments that are due on the date of
the class for which the homework is assigned. They may also take class participation and case
presentations into account. There will be a single major term project/paper that will constitute the
major basis for grading apart from class participation and homework. Students will select one of the
five faculty members to work with on their term papers. It is expected that they will consult the
faculty member at least twice during the term. That faculty member will be responsible for giving the
student feedback on the term paper and for issuing a grade. Term projects/papers may be any one of
the following: (1) a term paper on a topic selected by the student, (2) preparation of a case study on a
complex real estate project. The project may be either a privately-sponsored or publicly-sponsored
project in the United States or abroad, or (3) analyzing a complex deal, fund, or other investment
opportunity. Term papers are due on Monday, May 7 at 4:00 in Gund 312.




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Advanced Real Estate Development and Finance
GSD 5303
revised: January 21, 2012


week              date                             Professor     Topic                                   Case Study Due              Reading
                                                                 Land and Community Development
  1    Monday    January 23, 2012                  Peiser                                                Southspoon                  PRED Ch 1-3
                                                                 Financial Analysis

                                                                 Income Property Development-Stage 2 Quiz on Land Dev
  2    Monday    January 30, 2012                  Peiser                                                                            PRED Ch. 6, 8
                                                                 analysis Stage 3 analysis intro     Turner Building Case
                                                                                                     IBET
  3    Monday    February 6, 2012                  Apeseche      Underwriting acquistions                                            "Forecasting Multifamily Return"
                                                                                                     Cases A, B, C



  4    Monday    February 13, 2012                 Apeseche      Raising public and private capital      Berkshire's IPO             "Real Estate Private Equity Funds"



                                                   Presidents
       Monday    February 20, 2012
                                                   Day Holiday
                                                                 Building strategic controls in real     Berkshire Realty Holdings   "The Value Chain and Competitive
  5    Monday    February 27, 2012                 Apeseche                                              Term paper
                                                                 estate                                  paragraphs due              Advantage"


  6    Monday    March 5, 2012                        Peiser     Turner Bldg Stage 3 analysis

                                       Spring
       Monday    March 12, 2012
                                       recess


                                                                                                                                     Real Estate Physical and Financial
  7    Monday    March 19, 2012                    Mueller
                                                                 Real Estate Market Cycles                                           Cycles
       Extra                                                     Strategic requirements for different    Market Cycle Investment
                                                   Mueller
       Class                                                     investor needs/ REITs, cycle analysis   Strategy
  8    Monday    April 2, 2012                     Peiser        REITs and REIT Roll-ups                 AMB Case (HBS download) PRED Ch 4
                                                                  Wilmington Case Stage 5,
  9    Monday    March 26, 2012                    Peiser                                                Wilmington Case             PRED Ch 5
                                                                 institutional deal structures

  10   Monday    April 9, 2012                     Rodman        Bank credit policy/Finance in Asia

                                                                                                                                     Peiser, Wang article, JREPM,
  11   Monday    April 16, 2012                    Rodman        NPLs and finance in Asia                China Huarong Case Study
                                                                                                                                     2002.
  12   Monday    April 23, 2012      Last class    Georgi/Peiser International fund investment           888 Brannon

                                     Term Papers
       Monday    May 7, 2012
                                         Due




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