Program Overview

Real Estate Finance Fundamentals

This program presents critical “nuts-and-bolts” real estate finance principles and practices in a simple, understandable, and interactive manner that will demystify the real estate financing process—regardless of participants’ prior real estate finance experience.

Program Overview

The program focuses on real estate finance fundamentals that are important to either develop and/or invest in varied types of real estate assets, or to enhance your ability to understand how real estate finance fundamentals relate to your primary role as a member of a real estate development or investment team, all with emphasis on understanding how real estate value is created, measured, and managed.

What to Expect

• Interactive group exercises and lively classroom discussion
• Certificate of Completion
• Program Overview

Expect a lively and engaging interactive classroom experience, where key topics will include:

• Establishing realistic financial objectives
• Identifying and calculating the primary components of return in income-producing real estate, including cash flow, tax benefits, and futures; preparing operating and capital cost pro formas and sources and uses of funds statements.
• Understanding debt-financing underwriting basics, including net operating income, debt service coverage factors, annual constants, debt/equity ratios, and other lender underwriting requirements.
• Appreciating the importance of achieving positive financial leverage.
• Calculating and interpreting standard industry measures of return:
  • Return on Total Asset Cost (Cap Rate)
  • Cash-on-Cash Return
  • Leveraged and unleveraged Net Present Value (NPV)
  • Internal Rate of Return (IRR)
  • Equity Multiples

Other topics will include preparing sensitivity analyses and understanding simple Waterfall/Promote structures (the priority and amount of cash flow distributions to the respective financial and operating partners in a real estate joint development or investment joint venture).

Learning Objectives

• Identify the methodologies used to calculate the primary components of return in income-producing real estate.
• Establish reasonable financial return targets for each of these primary return components.
• Determine the debt financing level a project will likely achieve based upon applicable underwriting criteria.
• Prepare simple operating pro forma, capital cost pro forma, and sources and uses of funds statements.
• Understand the most common real estate industry measures of return and the relative importance of each measure.
• Understand the significance of Purchase, Operating, and Exit Cap Rates.
• Understand a simple Waterfall/Promote structure.

Who Should Attend

This program is intended for developers, architects, engineers, contractors, lenders, property managers, lawyers, brokers, investors, and other participants in the real estate development, investment, entitlement, or regulatory process, including private, public, and NGO-sector players.

Instructor

• David Smith
  • Founder and CEO, Affordable Housing Institute (AHI)

Program Details

• Tuition: $2,150 (save 10% with joint registration)
• CEUs: Pending
• AMDP Elective Units: 2
• Program Size: Limited
• Registration Deadline: 24 hours before the start of the program
• Discounts: Save 10% when registering for this program and Real Estate Development Fundamentals at the same time.