Dedication

Preface

Note for the Practitioner

Note for the Student

Note for the Instructor

Acknowledgments

Principles of Real Estate Finance

Introduction

Glossary

Thought Questions

Review Questions

Chapter 1. The Real Estate Industry

1.1 Types of Real Estate

1.2 Interests in Real Property

1.3 Forms of Property Ownership

1.4 Real Estate Functions

1.5 Types of Real Estate Companies

1.6 Ownership of Real Estate Companies

1.7 Other Real Estate Industry Participants

Glossary

Chapter 2. Market Analysis

2.1 Impact of the Economy on the Real Estate Market

2.2 Economic Influences on Specific Property Types

2.3 Economic and Demographic Analysis

2.4 Governmental and Political Factors

2.5 Analysis of Local Supply and Demand

2.6 Property-Specific Due Diligence

Glossary

Chapter 3. Accounting and Tax

3.1 Accounting Standards

3.2 Real Estate Income Statement

3.3 Real Estate Balance Sheet

3.4 Real Estate Cash Flow Statement

3.5 Taxation

3.6 Tax as a Transactional Consideration

Glossary

Chapter 4. Cash Flows and Modeling

4.1 Fundamental Principles

4.2 Modeling Development and Construction

4.3 Cash versus Accrual Modeling

4.4 Property-Type-Specific Issues

4.5 Building a Spreadsheet

4.6 Spreadsheet Analysis

Glossary

Chapter 5. Property Valuation

5.1 Capitalized NOI Method

5.2 Discounted Cash Flow (DCF) Method

5.3 Comparable Sales

5.4 Cost Approach

5.5 Value of Asset versus Value of Equity

5.6 Impact of In-Place Financing

5.7 Appraisal Process

Glossary

Chapter 6. Capital Markets

6.1 Why Invest in Real Estate?

6.2 Types of Real Estate Interests

6.3 Forms of Real Estate Investments

6.4 Types of Real Estate Securities

6.5 Real Estate Investors

6.6 Capital Market Participants

6.7 Market Statistics

Glossary

Chapter 7. Property Finance: Debt

7.1 Types of Real Estate Loans

7.2 Determining the Best Type and Source of Financing

7.3 Loan Terms

7.4 Determining Loan Amount

7.5 Property Lifecycle Issues

Glossary

Chapter 8. Mortgage-Backed Securities

8.1 The Development of Mortgage-Backed Securities

8.2 Benefits to Lenders and Borrowers from Securitization

8.3 Structuring Mortgage-Backed Securities

8.4 CMBS

8.5 RMBS

Glossary

Chapter 9. Property Finance: Equity

9.1 Characteristics

9.2 Forms of Equity Investment

9.3 Structuring Issues

9.4 Investors

9.5 Strategic Utilization of Equity by the Entrepreneur

Glossary

Chapter 10. Capital Structure

10.1 The Capital Stack

10.2 Use of Debt to Enhance Equity Yields

10.3 Impact of Leverage on Risk

10.4 Hybrid Financing Forms

10.5 Impact of Credit Markets on Property Valuation

10.6 Impact of Debt Terms on Optimum Capital Structure

10.7 Deconstructing a Debt Quote

Glossary

Chapter 11. Development Finance

11.1 Development Process

11.2 Key Participants

11.3 Financing Stages

11.4 Government Finance

11.5 Development Risks

11.6 Real Options

Glossary

Chapter 12. Housing Finance

12.1 Housing Finance

12.2 The Economic Impact of the U.S. Housing Market

12.3 History

12.4 Single-Family Home Financing

12.5 Multifamily

12.6 Housing Development

12.7 Impact of Housing Development on Local Infrastructure

Glossary

Chapter 13. REITs and Real Estate Corporate Finance

13.1 What is a REIT?

13.2 REIT Qualification Tests

13.3 Benefits to Investors

13.4 Capital Requirements

13.5 The REIT Operating Partnership

13.6 REIT Financial Statements

13.7 Common REIT Financial Metrics

13.8 Current REIT Market Statistics

13.9 The Non-REIT Real Estate Company

13.10 Real Estate Company Operations

13.11 History

Glossary

Chapter 14. Corporate Real Estate

14.1 Function

14.2 Goals

14.3 Strategic Real Estate Financing for Corporations

14.4 Financing Structures

14.5 Alternative Capital Sources for Corporate Real Estate

Glossary

Chapter 15. International Real Estate

15.1 Overview

15.2 Rewards

15.3 Risks

15.4 Investment Structure

15.5 Participants

Glossary

Index

Answers

Chapter 1

Chapter 2

Chapter 3

Chapter 4

Chapter 5

Chapter 6

Chapter 7

Chapter 8

Chapter 9

Chapter 10

Chapter 11

Chapter 12

Chapter 13

Chapter 14

Chapter 15