Streamlined and completely updated with expanded coverage of corporate and international real estate investment, this upper-level real estate text presents the essential concepts, principles, and tools necessary to analyze income-producing commercial real estate from an investment perspective. This new edition continues to integrate relevant aspects of urban and financial economics to provide users with a fundamental analytical understanding and application of real estate investments—now using a student version of ARGUS(R) software on CD included with the book. ARGUS(R) software is a Windows-based program used extensively in the real estate investment industry to solve complex investment and valuation problems. Also included on the CD is a student version of Crystal Ball(R), professional-grade software used to perform risk analysis on commercial investments. Author Piet Eichholtz contributes a chapter that explores international real estate investments, both opportunistically and structurally, by outlining elements for developing and implementing real estate investments successfully abroad. Jim Clayton from the University of Cincinnati thoroughly revised and updated the finance coverage and end-of-chapter questions throughout.
Table of Contents
Part I: INTRODUCTION TO REAL ESTATE ECONOMICS.
1. Real Estate Space and Asset Markets.
2. Real Estate System.
Part II: URBAN ECONOMICS AND REAL ESTATE ANALYSIS.
3. Central Place Theory and the System of Cities.
4. Inside the City I: Some Basic Urban Economics.
5. Inside the City II: A Closer Look.
6. Real Estate Market Analysis.
Part III: BASIC FINANCIAL ECONOMIC CONCEPTS AND TOOLS.
7. Real Estate as an Investment: Some Background Information.
8. Present Value Mathematics for Real Estate.
9. Measuring Investment Performance: The Concept of Returns.
Part IV: REAL ESTATE VALUATION AND INVESTMENT ANALYSIS AT THE MICROLEVEL.
10. The Basic Idea: DCF and NPV.
11. Nuts and Bolts for Real Estate Valuation: Cash Flow Proformas.
12. Advanced Microlevel Valuation.
Part V: COMPLETING THE BASIC INVESTMENT ANALYSIS PICTURE.
13. Use of Debt in Real Estate Investment: The Effect of Leverage.
14. After-Tax Investment Analysis & Corporate Real Estate.
15. Real Estate Investment Capital Structure.
Part VI: MORTGAGES FROM AN INVESTMENT PERSPECTIVE.
16. Mortgage Basics I: An Introduction and Overview.
17. Mortgage Basics II: Payments, Yields and Values.
18. Commercial Mortgage Analysis and Underwriting.
19. Commercial Mortgage Economics and Investment.
20. Introduction to Commercial Mortgage-Backed Securities.
Part VII: MACROLEVEL REAL ESTATE INVESTMENT ISSUES.
21. Real Estate Portfolio Theory: Strategic Investment Considerations.
22. Equilibrium Asset Valuation and Real Estate Price of Risk in the Capital Market.
23. Real Estate Investment Trusts (REITs).
24. International Real Estate Investment.
25. Data Challenges in Measuring Real Estate Periodic Returns.
26. Real Estate Investment Management: Performance Attribution and Evaluation.
Part VIII: REAL ESTATE DEVELOPMENT AND OTHER SELECTED TOPICS.
27. Real Options and Land Value.
28. Investment Analysis of Real Estate Development Projects: Overview & Background.
29. Investment Analysis of Real Estate Development Projects: Economic Analysis.
30. Leases and Leasing Strategy.
Appendix: Real Estate Price Indices Based on Regression Analysis.