Study Guide for Spring 2011
1. What are the two fundamental markets in commercial real estate?
2. List the three (3) major determinants of cap rates:
3.
If the cap rates prevailing in a given market are 8.5%, then how much would you
expect a property to sell for in that market if its annual net income were $125,000?
4. The ‘replacement cost’ level of rent
5. MSA
6. Net Absorption and Gross Absorption
7.
What would be the ‘short-term’ effect of an increase in demand for space usage
on the following factors?
1) Rent
2) Price of real estate assets
3) New development
4) Concessions to Tenants from Landlords
8.
List the major determinant of demand for the following property types:
Apartments
Office
Industrial
Retail
Hotel
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9.
Explain, using the concepts in the 4-quadrant diagram or linking the space to the
asset market why the real estate market had dramatic growth in prices with little to
no rent growth from 2000-2005.
Next, explain how the market collapsed in late
2005.
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- Spring '08
- Weaver,W
- Net Present Value, real estate market, Internal rate of return
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