Thesis (S.M. in Real Estate Development)--Massachusetts Institute of Technology, Program in Real Estate Development in Conjunction with the Center for Real Estate , 2010. / Cataloged from PDF version of thesis. / Includes bibliographical references (p. 67). / This thesis has a two-fold objective, namely to explore the role of cap rates in predicting the returns to commercial real estate, and to identify how cap rates can be used to improve the allocation of real estate in a dynamic investment portfolio. Seeking an answer to the first question, we run predictive regressions using data for real estate "All Properties" and for all four major property types, examining the predictability power of cap rates for a forecasting horizon from one to four quarters in the future. Moreover, we examine whether or not stock dividend-price ratio can predict real estate returns, and examine the predictability of stock returns by cap rates and dividend-price ratio. The analysis confirms that both cap rates and the dividend-price ratio can predict real estate "All Properties" returns for up to one year in the future. Concerning the analysis per property type, the results vary from property type to property type, and for different forecast horizons. Moreover, the analysis shows that stock returns can be predicted by the dividend-price ratio at all forecast horizons, whereas the cap rates seem to have somewhat limited predictive power regarding the stock returns. We approach the second question by following the dynamic portfolio allocation methodology proposed by Brandt and Santa-Clara (2006). We expand the existing set of "basis" assets comprised of stocks and real estate to include "conditional" portfolios, and then compute the portfolio weights of this expanded set of assets by applying the Markowitz solution to the optimization problem. We apply this methodology to three different portfolio rebalancing horizons. Moreover, we work with three cases for each portfolio, i.e. with the unconditional case, with the case where the dividend-price ratio is the only conditioning variable, and with the case where the cap rate is the second conditioning variable. In almost all instances the results confirm that, by adding the cap rate as an additional state variable, the performance of the portfolios increases significantly. The same conclusion stands when we impose a "no shorting" restriction to real estate, although now the role of cap rates seems somewhat less significant. / by Stylianos Avramidis. / S.M.in Real Estate Development

Thesis: S.M. in Real Estate Development, Massachusetts Institute of Technology, Program in Real Estate Development in conjunction with the Center for Real Estate, 2018. / Cataloged from PDF version of thesis. / Includes bibliographical references (pages 49-51). / The proposed expansion of the Boston Convention and Exhibition Center was approved by the Massachusetts legislature in 2009. In 2010, the governor put the expansion on hold citing an overstated economic impact. Proponents argue that expanding the convention center will lead to increased occupancy and significant economic benefits. But do the benefits outweigh the costs? The first part of this thesis provides an overview of the convention center market in the US as well as two case studies of convention centers that have undergone expansions. The second part closely examines the history and performance of the Boston Convention and Exhibition Center using data from the Massachusetts Convention Center Authority along with data from various other sources to project realistic economic costs and benefits of the expansion as currently proposed. / by Timothy Royce Graham. / S.M. in Real Estate Development

Thesis (S.M.)--Massachusetts Institute of Technology, Program in Real Estate Development in Conjunction with the Center for Real Estate , 2009. / This electronic version was submitted by the student author. The certified thesis is available in the Institute Archives and Special Collections. / Cataloged from student submitted PDF version of thesis. / Includes bibliographical references (p. 55-57). / The purpose of this paper is to explore investment opportunities in these now-distressed residential condo properties. The paper will characterize the economic and development environment to determine the extent of overbuilding and forecast future behavior amongst market participants. It will assess the behavior of bulk condo investors in previous downturns to assess both similarities and differences in the environment, and identify best practices in investment and asset management. Additionally, the paper will characterize the legal and management risks inherent in this type of investment. The paper will conclude that there are a number of different strategies for investing in bulk condos and their underlying debt. One of the hardest hit markets is Atlanta, Georgia, which is the focus of this paper. Each of these strategies is contingent on the type and expertise level of the individual investor, but there are certainly going to be appropriate avenues for investors to create value both from the physical asset and from purchasing debt. Atlanta is likely going to be an excellent market to pursue these deals because of unique localized factors including extraordinary state distress, low asset pricing, and limited competition. The findings in this paper conclude that distressed condominium investing is an extremely localized business, and the recommendations made in this paper are specific to Atlanta. While an investor may use the paper as a guide for investment in other locales, it would not be appropriate to use a cookie cutter approach in every city. There are also many risks and a great deal of unknowns in the bulk condo space. / (cont.) This downturn differs significantly from past real estate crises because of the complexity of the financial instruments used to fund condo projects as well as a completely different government response. It is clear that the government response up to this point has been as much of a hindrance as it has been a help. Government action must engage investors in financial instruments in a more predictable manner, and assure they will not engage in punitive legislative behavior to investors who profit from this crisis. / by Faraji L Whalen. / S.M.

Thesis: S.M. in Real Estate Development, Massachusetts Institute of Technology, Program in Real Estate Development in conjunction with the Center for Real Estate, 2018. / Cataloged from PDF version of thesis. / Includes bibliographical references (pages 34-35). / Mixed-use has emerged as one of the most popular and demanded forms of real estate development in many metropolitan regions around the world. While mixed-use development broadly incorporates a variety of functions including, residential, commercial, and retail programs within one project, there is little science in determining the 'optimal mix' in mixed-use development resulting in a programmatic melange. Current practices largely determine the program mix through "gut intuition" or "rule of thumb", and value mixed-use projects by the returns of the individual components. This study seeks to develop an alternative model in defining an ideal program mix in mixed-use development that is based on an optimized and quantifiable portfolio value. The goal is to develop a framework for determining a recipe for mixed-use development in the hope of guiding future development practices in building more efficient, profitable and sustainable mixed-use developments across the United States. This study sees an opportunity to apply Modern Portfolio Theory, a widely adopted method in the finance industry that determines the most efficient allocation in a portfolio of assets, to identify an optimal program mix in mixed-use development projects. Mixed-use developments are inherently a portfolio of distinct real estate assets. Each component product type, such as residential, office, and retail can be thought of as individual assets within a mixed-use portfolio. These component assets offer varying returns and volatilities due to their individual characteristics and correlations with the market. If a mixed-use project is viewed as a portfolio, then an opportunity exists to optimize the project by adjusting allocations in the individual assets, resulting in an efficiently programmed project that maximizes total project returns for a given level of risk. Using market data, this thesis intends to identify the 'optimal mix' for fourteen markets across the United States. The study seeks to discuss the real-world limitations of implementing these program mixes in order to propose a new method to quantify and evaluate programming in mixed-use development; a method based on determining an 'optimal mix' that will generate the highest risk-adjusted returns for an investor, bringing to the forefront a new method in intelligent programming. / by Weijia Song. / S.M. in Real Estate Development

Thesis: S.M. in Real Estate Development, Massachusetts Institute of Technology, Program in Real Estate Development in conjunction with the Center for Real Estate, 2016. / Cataloged from PDF version of thesis. / Includes bibliographical references (pages 61-63). / There are tremendous potential applications for blockchain technology, an innovative distributed ledger database system, within the real estate industry. This paper will explore one aspect-recording property titles- by comparing the benefits and limitations of a blockchain with those of the current record keeping system. This paper will begin with a brief overview of the current state of the title recording system in the U.S. followed by a deeper look into the procedures of one rapidly growing American city, Nashville (Davidson County), Tennessee. The goal is to understand current real estate title systems and technologies in order to identify their benefits and limitations. Next, this paper will introduce the concept of blockchain technology, starting with a high level technical overview of how the technology works, as well as its benefits and limitations. It will also examine Bitcoin, which operates on the largest blockchain, as a potential model, whose practical applications may be adapted in creating a more efficient and safer title registry system. Recommendations will then be made for possible methods of implementing a blockchain-based registry and how its use might change the way real estate title transactions are handled in Davidson County, TN in order to determine if the collective benefits outweigh the costs. The research to date leads to the following conclusions: A blockchain title recording system is the future of title record keeping and would provide immediate benefits over the current title recording system, with additional benefits accruing in the future as blockchain technology grows in acceptance. However, at the moment, these benefits do not yet outweigh the costs and challenges associated with implementing a prototype blockchain title registry system in Davidson County, or elsewhere in the country. That being said, steps can, and should be taken now to lay the foundation for a blockchain system. / by Avi Spielman. / S.M. in Real Estate Development

Thesis (S.M.)--Massachusetts Institute of Technology, Program in Real Estate Development in Conjunction with the Center for Real Estate , 2009. / This electronic version was submitted by the student author. The certified thesis is available in the Institute Archives and Special Collections. / Cataloged from student submitted PDF version of thesis. / Includes bibliographical references (p. 70-73). / Marketing is commonly mistaken in the real estate development industry for the practice of advertising and sales. In reality, marketing is a set of concepts and methods created primarily in the consumer packaged goods industry that start with a focus on the consumer. Many of these concepts and methods can be used in the real estate development process to create more thoughtful and competitive projects. This thesis focuses on the marketing concept of demand segmentation and whether the real estate development process could be better served through a more defined focus on identifying specific consumers through demand segmentation techniques. Specifically, this thesis will answer the following questions: What is the existing structure for real estate market analysis? What is the concept of demand segmentation and how might it apply to real estate development? How has consumer segmentation specifically been applied in real estate development ventures? What are some important considerations to be aware of when developing real estate for a specific consumer segment? To answer these questions, this thesis reviews current thinking on demand segmentation through a review of relevant, marketing related literature for both the real estate and consumer packaged goods industries. This thesis also examines three subject developments that are examples of completed real estate development projects that serve the specific needs of a deliberately identified demand segments. / (cont.) The intention of this thesis is to define current marketing practices, analyze how a concept commonly used in the consumer packaged goods industry can be adapted for real estate and discover a body of questions and conclusion that can advance the practice of demand segmentation on real estate development. / by Michael Burr Tilford. / S.M.

Thesis: M. Arch. in Real Estate Development, Massachusetts Institute of Technology, Department of Architecture, 2016. / Thesis: S.M. in Real Estate Development, Massachusetts Institute of Technology, Program in Real Estate Development in conjunction with the Center for Real Estate, 2016. / Cataloged from PDF version of thesis. / Includes bibliographical references (page 97). / The thesis project is a reaction to the alarming rate of building and development depreciation caused by foreign investment in the Middle Eastern city of Dubai. The intervention looks at how architects, developers, and planners can counteract this phenomenon by designing for speculation in order to mitigate future crises or successes. Understanding the economic terms of "creative destruction" and "planning obsolescence" are imperative to help structure such a proposal Though such terms were attributed to industrial products such as cars and electronics, they are today applicable in the context of Dubai and similar cities worldwide. Architecture and real estate products have become victim to this capitalist phenomenon. The project is framed as an architectural reaction to the world's increasing capability to make and accumulate in conjunction with a growing desire to be transient and global. Has architecture become a mere toy product which can be changed around as it become obsolete? Rather than be destroyed, how can architecture morph and be updated into something new? Architects are not in complete control of consumer wants and needs; these, too, continue to change at a dynamic pace. I argue that a synchronized system that can reflect flexibility is integral in order to maintain equilibrium in the urban economic model today The project design is an infrastructure capable of harnessing capital inflow and outflow while withstanding volatility, temporality and a population in-transit Dubai is the core case-study and the thesis explores how such a generic system can adapt to cities such as Miami, New York City and Juba. / by Marwan Joseph Abou Dib. / M. Arch. in Real Estate Development / S.M. in Real Estate Development

Thesis: S.M. in Real Estate Development, Massachusetts Institute of Technology, Program in Real Estate Development in conjunction with the Center for Real Estate, 2014. / This electronic version was submitted by the student author. The certified thesis is available in the Institute Archives and Special Collections. / Cataloged from student-submitted PDF version of thesis. / Includes bibliographical references (pages 75-80). / Global development has currently become an important business for developers. Although the business involves complex economic, political, and cultural issues, international real estate has been more attractive. Economic and political analysis tells the timing of getting into the market. Demographic analysis indicates if the market would expand and which target developers should focus on. Also, we can find out competitiveness and how to differentiate from other companies. Japan has not showed dramatic economic improvement for 20 years. The mature country has several issues: aging, low birth rate, and natural disasters. On the other hand, Summer Olympics 2020 will be held in Tokyo and the government has decided to dramatically improve the infrastructure. Japan will change and I would like to find out the opportunities and challenges of Japanese real estate. Hawaii market has been influenced by tourism. The market is really unique; the resort area attracts house buyers and renters from all over the world. Most visitors come from the US main land and Japan. Glancing the US and Japanese economy, developers can find out the real estate business opportunities. Vietnam has developed the infrastructure and real estate legal systems. With the new infrastructure development and the assistance of private developers, the country provides more housing. Moreover, the legal system had not allowed foreigners to own properties but has been changed to invite more capital from other countries. I have worked for a Japanese developer and experienced a short period of economic growth but we did not significantly invest and the good economy was over by the financial crisis. Most Japanese developers experienced the bubble economy and were tremendously influenced by that time, becoming more cautious in their outlook. The timing for expanding business now is perhaps not optimal. However, the benefits and challenges in these regions can be well-balanced for global developers who are eager to gain a foothold into international real estate markets. / by Mitsuhiro Nomura. / S.M. in Real Estate Development

Thesis (M.C.P.)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning, 1980. / MICROFICHE COPY AVAILABLE IN ARCHIVES AND ROTCH. / Includes bibliographical references. / by Andrew A. Smith, Jr. / M.C.P.

Thesis: S.M. in Real Estate Development, Massachusetts Institute of Technology, Program in Real Estate Development in conjunction with the Center for Real Estate, 2018. / Cataloged from PDF version of thesis. / Includes bibliographical references (page 31). / In equity markets, dividend yields are highly correlated with future returns, largely through capital appreciation. Taking the same logic and applying it to the commercial real estate market -- could cap rates therefore predict future appreciation return? This paper finds that absolute cap rates are not significantly correlated with future appreciation or depreciation. However, regressions of first-differenced cap rates on future price appreciation find strong statistical significance at one, two, and three-quarter forecasts. The relation is strongest at a two quarter forecast, declining at four-quarter forecasts and thereafter. These findings support a case for momentum in commercial real estate pricing. Pricing movements, via cap rate changes, predict future appreciation or depreciation. The statistical results show that changes in cap rates are inversely correlated with future price appreciation or depreciation. When cap rates shift downward. properties tend to appreciate in future quarters, on average. And when cap rates shift upward, properties tend to depreciate in future quarters, on average. The analysis is bifurcated by asset type and market size. When analyzing this relation on an asset-class level, the predictive power of cap rate changes on future appreciation and depreciation is strongest in retail. Additionally, this relation is stronger in Primary CSAs than in Secondary CSAs. Astute investors should keep a close watch on the capital markets as they implement portfolio management strategies. While not to be utilized in isolation, these findings on momentum should be taken in context of a greater acquisition and disposition strategy. / by Frank Kettler. / S.M. in Real Estate Development