| CODE | ISR5044 | ||||||
| TITLE | Corporate Finance in Real Estate Markets | ||||||
| UM LEVEL | 05 - Postgraduate Modular Diploma or Degree Course | ||||||
| MQF LEVEL | 7 | ||||||
| ECTS CREDITS | 5 | ||||||
| DEPARTMENT | Insurance and Risk Management | ||||||
| DESCRIPTION | Corporate finance in real estate markets entails overseeing financial resources and capital within enterprises in the real estate sector. This area covers a range of financial aspects concerning real estate development, investment, and property management. Real estate companies use capital budgeting to assess the financial feasibility of new real estate projects or investments through cash flow analysis, risk assessment, and return estimation. This entails utilizing methodologies such as Net Present Value (NPV), Internal Rate of Return (IRR), and discounted cash flow (DCF) analysis. It will cover the right combination of debt and equity, negotiating financing conditions, and overseeing the company's capital arrangement to enhance the cost of capital while taking risk into account. It will discuss hazards including market swings, interest rate concerns, and property-specific risks. Moreover, it includes methods such as diversification, hedging, insurance, and other risk management measures to reduce hazards. It will discuss mergers, acquisitions, and collaborations. This study-unit plays a vital role in assessing the value of transactions, selecting the most suitable financing arrangement, and evaluating the possible synergies between different businesses. It involves asset management overseeing acquired properties to make judgments on leasing, property enhancements, and methods for maximizing the property's value and profits. Study-Unit Aims: Studying corporate finance in real estate markets is essential for understanding Real Estate Finance Principles. The study-unit offers a thorough evaluation of financial principles and instruments tailored to the real estate sector. This involves specifying property valuation, financing mechanisms, risk management, and investment analysis that are specific to real estate assets. It delves into investment decisions. It provides individuals with the ability to evaluate the financial feasibility of real estate ventures. This entails assessing investment prospects, performing risk assessments, and making well-informed decisions to optimize returns and mitigate risks. Furthermore, it assists students in assessing and overseeing properties with greater efficiency. This involves tactics for maximizing revenue, making decisions to improve property, and effectively allocating resources. It explains Capital Structure and Financing Strategies. Students learn about numerous financing choices in real estate and how diverse capital structures can affect risk and return. This allows for making well-informed decisions regarding utilizing debt, equity, and alternative funding strategies. Other objectives include evaluating Risk Mitigation and Management. This is the process of recognizing and reducing risks linked to real estate investments. This entails studying various risk management approaches and tactics to protect investments against market swings, interest rate variations, and other dangers. Enforcing compliance and reporting standards, Analysing and predicting, and incorporating Sustainability and ESG Factors. Learning Outcomes: 1. Knowledge & Understanding: By the end of the study-unit the student will be able to: - Analyse financial statements, cash flow analysis, and financial ratios specific to the real estate industry, interpreting and analysing financial data to make informed investment decisions. - Carry out Property Valuation, mastering different valuation methods such as the income approach, market approach, and cost approach to determine the value of real estate assets. - Develop skills to identify, assess, and manage various risks associated with real estate investments, including understanding market risks, interest rate fluctuations, and property-specific risks. - Evaluate potential real estate investments through techniques like Net Present Value (NPV), Internal Rate of Return (IRR), and cash flow analysis, making decisions on whether to invest in a particular property or project. - Understand strategies for different financing options available for real estate projects, including debt financing, equity financing, mezzanine financing, and joint ventures, analysing the implications of each on the overall cost of capital and the risk-return profile. - Apply knowledge about legal frameworks, property laws, zoning regulations, and other legal aspects crucial to real estate transactions and property management. - Analyse market trends, forecast changes in supply and demand, and predict future market movements to inform investment decisions. - Manage real estate assets efficiently, including property maintenance, tenant relations, lease negotiations, and strategic property improvements. - Determine the impact of Environmental, Social, and Governance (ESG) factors on real estate investments and integrate sustainability considerations into financial decision-making processes. 2. Skills: By the end of the study-unit the student will be able to: - Handle the complexities of corporate finance in the real estate market. This entails the capacity to scrutinize financial data, evaluate risks, and formulate well-informed investment choices. - Develop expertise in asset management strategies, enabling them to efficiently supervise real estate investments. - Demonstrate a profound comprehension of the financial consequences related to real estate deals, allowing them to analyse financial information in the context of real estate investments. - Negotiate the financial aspects of the real estate industry confidently and competently. Main Text/s and any supplementary readings: - Hartzell, David, Baum, Andrew E. (2021). Real Estate Investment and Finance: Strategies, Structures, Decisions (Wiley Finance) 2nd Edition |
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| STUDY-UNIT TYPE | Lecture | ||||||
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The University makes every effort to ensure that the published Courses Plans, Programmes of Study and Study-Unit information are complete and up-to-date at the time of publication. The University reserves the right to make changes in case errors are detected after publication.
The availability of optional units may be subject to timetabling constraints. Units not attracting a sufficient number of registrations may be withdrawn without notice. It should be noted that all the information in the description above applies to study-units available during the academic year 2025/6. It may be subject to change in subsequent years. |
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