Real Estate Investing 360Cornell

Certificate Program

Real estate investment is a popular way to accumulate wealth, but you don't have to be rich to get started. That's because there are many ways to finance real estate investments to raise the equity you need and structure debt beneficially. In this course, you will explore both sides of the financing equation to understand what equity and debt partners want, how to structure financing for a high likelihood of approval and rate of return, and how to perform analyses that are critical to success. Not only will these analyses upgrade your skills, the sophisticated spreadsheet tools you use can be applied immediately to real-life opportunities.

You are required to have completed the following course or have equivalent experience before taking this course:

• Real Estate Investment Decisions

Is the value of your proposed property greater than its cost? Can you confidently forecast revenues for both new and existing properties? The ability to produce accurate estimates of rents, occupancy, and absorption is essential in making real estate investment and financing decisions.

In this course, you will explore the process of accurately forecasting real estate occupancy for properties facing significant new competition. You will forecast revenues and expenses using contemporary techniques, including real estate cash flows and benchmarking analysis. Given that forecasts are only as accurate as starting assumptions, you will also investigate how to use data to support your forecasts.

By the end of this course, you will have the strong foundation needed to create a successful and rigorous feasibility study and to use your skills to produce accurate, supportable forecasts.

You are required to have completed the following courses or have equivalent experience before taking this course:

• Real Estate Investment Decisions
• Financing Real Estate Investments

Without well-established rights to acquire, charge rents, and sell real estate, investors will not invest. Legal systems create these rules and institutions that facilitate the efficient identification and transfer of real property rights. So how do you tackle the legal aspects of real estate?

In this course, you will explore the various estates in real property, including how property ownership is registered or recorded, how real property interests are transferred, and how ownership can be shared. You will understand the vocabulary of real property rights, identify the limitations on property rights, and examine the major contracts that surround real property transfer.

By the end of this course, you will have the knowledge needed to connect financial and property rights, setting you up to increase the value of your property and transform fundamental property rights to your benefit.

You are required to have completed the following courses or have equivalent experience before taking this course:

• Real Estate Investment Decisions
• Financing Real Estate Investments

No survey of real estate as a financial asset would be complete without a discussion of appraisal. Understanding this critical piece of the process will set you up for success when you make complex decisions.

In this course, you will explore the classic triad of real estate valuation methods: the cost approach, the sales comparison approach, and the income approach. The appraiser's task is to produce an estimate of the value of the real estate using each approach then reconcile these values in a final market value estimate. You will not become an appraiser in this course, but you will understand how to use appraisals to make better investment decisions and potentially increase the value of your real estate.

Upon completion of this course, you will be able to use appraisals to make better decisions in a variety of areas in real estate. In the field, you will be able to use appraisals to support real estate investment decisions, asset management decisions, disposition decisions, refinancing decisions, and more.

You are required to have completed the following courses or have equivalent experience before taking this course:

• Real Estate Investment Decisions
• Financing Real Estate Investments

Real estate investment trusts (REITs) are becoming an accepted equity structure around the globe, and commercial mortgage-backed securities (CMBS) create liquidity and lower the cost of borrowing for real estate developers and owners. Understanding their vocabulary and importance can set you up for successful, forward-looking strategies in your future projects.

In this course, you will consider public real estate structures and their markets with a focus on the practical aspects of public equity (REIT) and public debt (CMBS) structures and markets. You will concentrate on the impact that REIT legislation has on the operation of REITs and how CMBS is designed to manage the risks of default and prepayment.

By the end of the course, you will have a deeper understanding of real estate public markets as well as an ability to analyze how real estate performs as a security in the secondary market.

You are required to have completed the following courses or have equivalent experience before taking this course:

• Real Estate Investment Decisions
• Financing Real Estate Investments

In this course, you will gain an overview of real estate financial modeling, focusing on properties with multi-year leases. Using the models and frameworks established as today's industry standards in real estate, you will explore deriving basic valuations and performance calculations. You'll discover how a discounted cash flow model can be used to deliver sound real estate investment and financial decision-making through hands-on practical exercises.

As part of this process, this course will introduce the various Excel functions required to develop dynamic models to assist decision-makers. To be successful, these tools must be simple to use and interpret, must offer realistic outcomes to complex hypothetical real estate situations, and must be capable of handling a wide range of scenarios. High-stakes decision-making requires a comprehensive understanding of the options and their associated risk. Therefore, the first step is to adopt best practices then apply the essential building blocks in Excel that will be covered in this course, creating a foundation for your future work in this area.

In the competitive world of commercial real estate and asset management, creating reliable tools like acquisition models will allow you to make confident predictions, even in the face of common risks such as building vacancy. In this hands-on course, you will analyze the procedure for building a structural model from the ground up.

This course will start with forecasting rental income and its main challenge, vacancy, for an office building. Forecasting future operating income requires looking lease by lease through each source of operational revenue and expense. Some items, such as expense recoveries, are recurring; others, like tenant improvements and leasing commissions, are exceptional. From here, an estimation of value and performance will require an assessment of the risks to which the investment will be exposed. Aggregating this forecast of unlevered income after making the proper adjustments for risk is the foundation for all future acquisition models. By the end of this course, you will be poised for success as you apply the concepts from this course in your role and beyond.

You are required to have completed the following course or have equivalent experience before taking this course:

• Discounted Cash Flows in Real Estate

OR

• Familiarity with the Microsoft Excel environment and the structure of a basic discounted cash flow model
• The ability to apply conditional functions in Excel (IF statements and LOOKUP, TRUE/FALSE, INDEX/MATCH, OFFSET, and MIN/MAX functions) to produce the desired outcome

While all commercial real estate transactions first require understanding the merits of a particular location and property, investors also pay close attention to the capital stack and the equity at risk. In fact, few deals are done with equity capital only. Using external financing to close on certain transactions is often motivated by risk-adjusted target performances. When done carefully, investors can take advantage of the cheaper cost of capital to potentially magnify their returns positively.

In this course, you will expand on the basic underwriting model for property acquisition to incorporate financial leverage and scenario analysis. The first step is to take a precise look at how the most common types of mortgages work, noting that financing and capital structure decisions are far more complex than just building amortization tables. They include crucial details that can lead to a deal's success or failure and have important ramifications down the road. To apply your learnings on the optimal balance in your deal structure, you will model a variety of scenarios across many loan types while keeping the element of uncertainty in the forefront. You will acquire a what-if mindset through this process, helping you identify the optimal capital structure given the deal you are contemplating. With this tool combining your forecasting intelligence with a strategic choice, you will be set up to expand your knowledge in new ways and grow in your role and beyond.

You are required to have completed the following courses or have equivalent experience before taking this course:

• Discounted Cash Flows in Real Estate
• Unlevered Real Estate Acquisitions

With population growth and a finite amount of space on this planet comes a natural expansion of the land we use for human activity, and real estate development is the immediate consequence of this ever-growing human footprint. Most of the time, real estate development is a business in and of itself, with each development decision requiring meticulous economic analysis.

In this course, you will start by assessing the real estate process as a whole, which will inform your understanding of why properties are located where they are. You will then examine the financing process that facilitates real estate development. To apply your knowledge, you will build a model from the ground up that includes the sequence of various equity and construction loan draws, including how to reallocate the proceeds. The course concludes with an evaluation of the optimal use of a vacant lot in New York City. You will apply what you have studied throughout this course to make a recommendation with respect to the appropriate land value and its best use given the financing structure in place, providing you with experience and best practices to apply to your role.

You are required to have completed the following courses or have equivalent experience before taking this course:

• Discounted Cash Flows in Real Estate
• Unlevered Real Estate Acquisitions
• Real Estate Debt Financing and Scenario Analysis

Most commercial real estate deals succeed or break down around a simple concept: Does the ownership have what it takes to make it happen? The dilemma, then, that most investors contemplate is whether to be the sole investor and own all risks and profits or to partner with someone in a joint venture.

In this course, you will discover how to analyze these options for a variety of investment scenarios, balancing the right incentives for each partner to perform at their best while avoiding conflicts of interest. You will examine examples of incentives, including profit-sharing rules, assessing the options when it comes to profit distribution and the variables involved, such as the timing and proportions of this disbursement.

You will then gain experience applying the most common profit-sharing rules at the joint-venture level by building an equity waterfall from the ground up that includes four layers of distribution. By the end of this course, you will have more context and experience with joint ventures and the variables behind successful deals in the marketplace.

You are required to have completed the following courses or have equivalent experience before taking this course:

• Discounted Cash Flows in Real Estate
• Unlevered Real Estate Acquisitions
• Real Estate Debt Financing and Scenario Analysis
• Real Estate Development Financing

In this course, you will apply real estate financial modeling skills to a real-world example, offering the advantages of immersive decision-making but also assessment of that decision based on the outcome of a real example. You will examine an opportunity to invest in a Class B building located within the New York City submarket of Hell's Kitchen on the west side of Manhattan. You will walk through the process of carefully underwriting the deal and, ultimately, deciding whether or not to invest.

In the process of this example transaction, you will gain experience using the industry's commonly adopted approach: utilizing widely used modeling tools including Microsoft Excel and ARGUS, which is used to model office, retail, and industrial operating cash flows. By adjusting crucial variables, you will discover new insights in the process of creating a dynamic model using these industry best practices. Finally, you will delve into the step-by-step market analysis behind each one of the tenant scenarios to inform a final recommendation. By experiencing the whole project process, you will be equipped to apply these skills to your projects across the industry.

You are required to have completed the following courses or have equivalent experience before taking this course:

• Discounted Cash Flows in Real Estate
• Unlevered Real Estate Acquisitions
• Real Estate Debt Financing and Scenario Analysis
• Real Estate Development Financing
• Equity Waterfalls in Joint Ventures

As real estate asset manager, you are steward of an owner's property, responsible for managing it to help achieve the owner's goals and increase its value. To guide you in this challenging role, you need a comprehensive road map for decision making: the Asset Management Strategic Plan. This course focuses on teaching you how to build this strategic plan and on developing your understanding of the asset manager role, its activities, and different management approaches. Beyond best practices and expert insights, this course also provides you with ample opportunities to practice new skills and an applied toolkit for real-world real estate asset management.

You are required to have completed the following course or have equivalent experience before taking this course:

• Leading Successful Property Management Operations

Within the commercial real estate industry, it is vital to develop a deep understanding of an asset's condition as well as the market in which it competes. There are several strategies for optimizing your occupancy and lease rates through an evaluation of the competitive landscape. This critical look at your market environment will enable you to best position your real estate assets in terms of lease structures, leasing trends, term expectations, and much more.

This course has been designed to simulate the way in which asset managers, along with those working in leasing departments, gather information and develop a leasing strategy. You will create a leasing strategy to convey the pertinent data about an asset and the market landscape to a particular audience. This course will train your eye to scan a property for key indicators of physical and financial health. Using a variety of downloadable tools, you will determine how to gather data for analysis that will provide insight and inform decision making for every step of the cycle of tenancy.

In commercial real estate, managing the upkeep of the physical asset is critical for multiple reasons, including occupant safety, meeting legal occupancy requirements, functionality of systems, efficiencies of systems, productivity of occupants, maintaining asset value, and more. Successfully optimizing the functionality of a building requires a strategic approach to maintenance activities and equipment selection, as well as continually seeking new technologies, devices, and practices to improve building performance and reduce departmental expenses. In this course, you will access important building management strategies and best practices, professional expert interviews, and exercises that bring various strategies to light.

This course has been designed to simulate the way in which asset managers, building managers, and other stakeholders gather, analyze, and use various forms of building maintenance information to make decisions. Throughout this course, you will develop a robust tool kit of skills and resources to deal with property management issues including labor, code, financial management, and renovations. As you build your knowledge and skills in facilities management, you will be able to offer valuable recommendations and ask pertinent questions that will improve any asset's physical functionality and enhance the business's financial performance.

Large buildings are some of the leading consumers of resources such as raw materials, electricity, and water. They also generate an incredible amount of waste. Customers and potential lessees now expect asset management to be transparent in their deployment of sustainable practices. On the flip side of this expectation, it has never been easier to make, measure, and communicate improvement in the area of sustainable operation. In this course, you will discover the importance of depth, clarity, and transparency when developing a sustainability strategy. You will then determine how to align your everyday efficiency goals with your overall sustainability strategy through environmental policies and practices, as well as the products you choose.

Taking it a step further, you will investigate the popular “green” certification standards and the options available for new development projects and existing buildings. You will make on-site observations of a LEED-certified building and explore the criteria making the LEED and Green Globes programs the international benchmarks for green building design and operation.

Beyond building design, there are valuable opportunities to empower and encourage your employees and/or residents to adopt sustainable practices by establishing a “green team” within your building or company. This team usually includes individuals passionate about sustainability and preserving the environment, so they will often be happy to help ensure your sustainability goals are met, in turn having a positive effect on waste reduction and, thus, your bottom line.