RIL 369 Exam 1 Cheat Sheet - 1. Real estate development has...

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1. Real estate development has been defined as the ongoing reconfig of D the built environment 2. The Irvine Ranch is near LA, CA and one of the best planned communities in US 3. Sad Sisters were ‘worker homes’: saved from destruction at developer expense and dismantled by historic preservat 4. Equity—source of capital that absorbs the most risk 5. Features incorp into resid dwellings depend heavily upon – income level of target household 6. Prof James Gras stated when one buys real estate – buys a set of assumptions about the future 7. Apartment projects most vulnerable to vacancies in a down cycle—those furthest from CBD 8. Capitalization—process of converting periodic income into a value estimate 9. Contract Rent—is seldom equal to market rent 10. Capital expenditures—prolong the life of the building and add value to property 11. We will only incorporate depreciation – in the DCF model 12. Values fail to incorporate cash flows beyond first year of analysis in first pass of returns ratios and multipliers 13. BTCF is a levered cash flow, NOI is an unlevered cash flow 14. Capitalization rate—overall income producing ability of property 15. The investor will purchase the property as long as NPV is – greater than zero 16. Both NPV and going in IRR increase—when the investor increases his leverage rate 17. Utopia—sir Thomas moore POWERPOINTMarket Prices are the best available signals to direct resource allocation Coase Theorem: regulate only when the benefits derived from regulation exceed costs Pareto improvement—making at least one individual better w/o making another worse
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This note was uploaded on 09/27/2011 for the course FINANCE 369 taught by Professor Nelson during the Spring '11 term at Missouri State University-Springfield.

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RIL 369 Exam 1 Cheat Sheet - 1. Real estate development has...

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