COURSE NUMBER: MBA280.1

This course is cross-listed with the EWMBA Program.

COURSE TITLE: Real Estate Investment and Market Analysis

UNITS OF CREDIT: 3 Units

INSTRUCTORS: Nancy Wallace

EMAIL ADDRESSES: wallace@haas.berkeley.edu

MEETING DAY(S)/TIME: Monday, 6:00 – 9:30 PM

CLASS WEB PAGE LOCATION (HTTP URL): http://bspace.berkeley.edu

PREREQUISITE(S): None

CLASS FORMAT: The class format will be a mixture of lectures and case discussions.

REQUIRED READINGS: Bruggeman and Fisher, Real Estate Finance and Investments (14^th Edition, 2010), McGraw Hill.

BASIS FOR FINAL GRADE: Midterm, Case write-ups, Applied Innovation Course project.

ABSTRACT OF COURSE'S CONTENT AND OBJECTIVES: This is an introductory MBA course in real estate investment and market analysis. The course begins by introducing the fundamentals of real estate valuation and risk analysis ,including mortgage financing and taxation. The course then examines issues related to the financial and operational aspect of real estate markets, including techniques to evaluate supply and demand in these markets, as well as the determinants of rents, prices and development patterns and zoning and other forms of land use regulation. The asset types include both commercial buildings (e.g. office buildings and retail properties) and residential( single- and multi-family). Alternative ownership strategies such as real estate investment trusts (REITs) and real estate syndications and data regarding the returns to real estate investment are studied. Sources and solutions for the subprime crisis in real estate and capital markets are discussed and the implications of innovations for commercial and residential real estate development and investment are considered.

As an Applied Innovation Course (part of the BILD curriculum), the primary deliverable for this course will be a comprehensive analysis of repositioning available properties in Berkeley CA and environs. This analysis will include concept development, full market analysis, funding strategy, and entitlement and stakeholder consultation and approval strategies. The project deliverable requires the coordinated efforts of working teams, each consisting of five to six students, focusing on different aspects of the project, including, as noted above, design, market analysis, funding, and entitlements and stakeholder approval. For example, the deliverable from the entitlements and stakeholder team will include evidence of interviewing and assessing the objectives of numerous competing stakeholder including the City of Berkeley, the University of California, Berkeley, business owners, local neighborhood or community associations, and other relevant groups. The course deliverables will be the product of extensive face-to-face interactions with stakeholders, real estate professionals, design professionals and capital market providers. The project will engage with virtually all of the capabilities of applied innovation focus, with special emphasis on problem framing, opportunity recognition, revenue model innovation, managing ambiguity and conflict, team creativity and adaptive governance. A number of the stakeholders will themselves play an active role in the vetting and approval process for the final written group project and presentation. Students in MBA280 who are also successful candidates for either the NAIOP Competition Team or the Bank of America Low Income Housing Team will be allowed to substitute their team competition products (written deal book and presentation) for the final project for the class.

BIOGRAPHICAL SKETCHES

Nancy Wallace is a Professor of Finance and Real Estate and holds the Lisle and Roslyn Payne Chair in Real Estate and Capital Markets at the Haas School of Business, the University of California, Berkeley. She is Chair of the Real Estate Group, Co-Chair of the Fisher Center for Real Estate and Urban Economics, and is a Faculty Co-Director of the Berkeley Center for Law, Business & the Economy, Berkeley Law. She teaches asset-backed securitization, real estate investment analysis, real estate strategy, and real estate finance at Haas. Her research focus includes residential house price dynamics, mortgage contract design and pricing, securitization and asset backed security pricing and hedging, lease contract design and pricing, methods to underwrite energy efficiency in commercial mortgages, and valuation models for executive stock options. She has served as a visiting scholar at the New York Federal Reserve Bank, the San Francisco Federal Reserve Bank, the Université de Cergy Pointoise, Centre de Recherche THEMA (Théorie Economique, Modélisation, et Applications), and the Stockholm School of Economics. Professor Wallace is a past President of the American Real Estate and Urban Economics Association and a past member of the AREUEA Board of Directors. She is on the editorial board of the Journal of Computational Finance. Professor Wallace is currently a member of the Financial Research Advisory Committee, Office of Financial Research, U.S. Treasury Department and the Model Validation Council for the Federal Reserve System.