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. 79-81). / Success in frontier markets could mean high returns for real estate developers and investors. In order to succeed, companies must determine how to provide their products or services in an environment that may not necessarily adhere to familiar institutional, legal or even ethical norms. Strategists may never feel informed enough to make educated decisions because there is not enough data to populate sophisticated financial models. However investors and multinationals have a growing desire to gain exposure to underdeveloped markets. This leaves managers with the challenge of evaluating frontier investment markets and navigating risky foreign business environments. This thesis attempts to answer the following question: to what extent can a researcher establish a viable framework to strategically plan for and operate in frontier market built environments? To answer this question, this thesis shall first address the nature of "frontier markets," then proposes a framework for entrepreneurs or multinationals intending to penetrate a frontier market's built environment through either direct investing or real estate development. The framework is a qualitative model, a compilation of analysis tools used by scholars, economists, political scientists, and investors working with and in emerging markets. The framework assesses markets on a broader, strategic echelon as well as an operational business management level. Lastly, we populate the framework with current information from Iraq, one of the most challenging and interesting frontier markets in the world today. The conclusion assesses the utility of the framework by highlighting information voids as well as potential business opportunities. The conclusion articulates that frontier market analysis will never be as valid as analysis of the developed markets because frontier markets are inefficient and information is difficult to ascertain, thus satisfying the definition of "frontier market". The analysis framework will not yield empirical findings like accurate forecasts of NPV, PV, IRR, etc. It will return, qualitatively, institutional voids in potential business opportunities. Keywords: frontier markets, Iraq, real estate. / by Steven C. Watkins, Jr. / 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, 2011. / This electronic version was submitted by the student author. The certified thesis is available in the Institute Archives and Special Collections. / "September 2011." Cataloged from student-submitted PDF version of thesis. / Includes bibliographical references (p. 51-52). / This thesis provides an empirical analysis of the determinants of foreign direct investment in commercial real estate (FDIRE) in the U.S. We examine the major factors that affect levels of FDIRE in the U.S. and foreign investors' location preferences. First, using panel data from 2002 to 2006, this research develops a model to test the importance of GDP, GDP growth, national investment level, exchange rate, and interest rate in determining levels of FDIRE in the U.S. from major developed countries. Results of the study suggest that economic growth of a country unexpectedly encourages domestic investment rather than foreign investment, and depreciation of currency value of the host country attracts more FDIRE. Second, the study analyzes the spatial distribution of FDIRE at the state level for the time period 1999 to 2007. A set of location determinants is selected to explain the pattern of FDIRE. These determinants include size of population, personal income, commercial real estate vacancy rate, commercial real estate completion rate, population growth, and personal income growth. Results of the study suggest that foreign investors prefer larger and wealthier states for direct commercial real estate investment. There is also evidence showing that foreign investors begin to diversify toward less populous and less wealthy states. / by Min Liang and Sunghoon Yoon. / S.M.in Real Estate Development

Thesis (M. Arch.)--Massachusetts Institute of Technology, Dept. of Architecture; and, (S.M. in Real Estate Development)--Massachusetts Institute of Technology, Program in Real Estate Development in Conjunction with the Center for Real Estate, 2012. / Page 143 blank. Cataloged from PDF version of thesis. / Includes bibliographical references (p. 135-137). / Inspired by Singapore's recent effort in building its new skyline in Maria Bay, the thesis intends to employ econometric structural modeling techniques to Singapore's office market for the period from 1975 to 2011. Using data collected from Singapore's Urban Redevelopment Authority, the regression models established by rent, demand and supply equations, dissect the market behavior and project an understanding of the underlying correlation and market mechanism. With which, the thesis forecasts for the next 10 years, in quarterly interval, the movement trajectory of Singapore's office market. Living and working as activities in this current milieu where role play in the system of power are essential to success was problematized; In the era when social and financial "cloud participation" has given rise to ebay, Facebook, Twitter and Wikipedia, what does work, live and play mean in this current environment where indulgence and consumption for its very own sake is very much part of the cultural lifestyle. Where is Architect in this financial time? In as much as it is about providing plausible answers, this thesis challenges the existing power system in the Real Estate industry, instead of taking dweller's spatial appropriation as guerrilla activities, the thesis proposes ways that channels private equity "financial cloud participation" into system of value production. Architectural proposition therefore works in way which turns these underlying power struggle scenarios into formal expression. / by Aoran Alex Sun. / S.M.in Real Estate Development / M.Arch.

Thesis (S.M. in Real Estate Development)--Massachusetts Institute of Technology, Program in Real Estate Development in Conjunction with the Center for Real Estate, 2013. / 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 91-94). / The Low Income Housing Tax Credit (LIHTC) program is one of the most successful government subsidy programs for the creation of affordable housing in the history of the United States. Over its 27 year existence, more than two million affordable apartments have been developed or rehabilitated using private equity financing through the sale of federal tax credits. Over the past 12 years the industry has digested the first wave of transactions getting to the end of the 15 year Initial Compliance Period. This is the point at which the Investor Limited Partner (ILP) is able to exit the transaction without tax credit recapture risk with the IRS. There is often a recapitalization event that accompanies the exit, but many times there is not. Since the secondary market for both LP and GP interests both during and after the compliance period is relatively illiquid, it is difficult to discern the fair market value of such an asset. This is further complicated by the unique and multi-layered financing structures common in these transactions and the additional 15-year Extended Use Period requiring the property to remain as affordable housing, in many cases beyond its useful life. This study will use limited partner transaction disposition data provided by a national tax credit syndicator to create a hedonic pricing model to determine the factors that drive valuation at disposition. Using the sample of 223 observations, the characteristics of which closely resemble the population of dispositions industry wide, the resultant hedonic model suggests that a partnership's original total development cost, net operating income (NOI) at disposition, cash or reserve balances on hand at disposition, the strength of the rental market and whether affordability requirements are expiring are the driving forces behind valuation of ILP interests at Year 15. As expected, some common factors that drive valuation in conventionally financed multi-family real estate transactions, including transaction size and regional location, have little predictive impact on valuation as determined by the model. The results of the analysis are contained within, along with the policy implications and some suggested programmatic reforms that could help to enhance the value of LIHTC properties at Year 15 and thus increase the likelihood of long-term financial health and ultimate preservation as Affordable Housing. / by Jakob B. von Trapp. / 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, 2011. / 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. 107-110). / The retail industry in the 21st century is undergoing a confluence of transformative changes. In this paper we discuss particularly noteworthy changes related to demography, retail economics and the Internet. We note how, in reaction to those transformations, brick-and-mortar retailers have developed innovative strategies to maintain growth and store performance, such as urban market penetration and multi-channel selling. We also have done a rigorous analysis of retail performance across major U.S. markets to determine the ex post and ex ante effects of trends and strategy changes. The hypothesis of this paper is that the conventional definition of "good" retail real estate has substantially changed in the last decade. The analytic approach of this paper is to: 1) observe broad retail industry trends, 2) conduct industry interviews to identify corresponding retailer strategy shifts, 3) perform cross-metro analysis of retail performance and 4) extrapolate meaningful effects on retail real estate. This provides owners, operators and developers of retail properties insight into the evolving characteristics and needs of tenants as they adapt to the new retail environment. Conclusions include description of the attributes of markets, properties, tenant mixes and amenities that best support contemporary retailing. Commentary and analysis is also provided on the impact of e-commerce and bricks-and-mortar retailers' adoption of multi-channel selling. Some results are that larger, denser markets have less consumption per capita, but those markets are generally underserved and have greater store gross revenues. Retailers are motivated to enter urban markets with flexible prototypes and online platforms. Population growth serves as a wealth proxy and corresponds strongly with sales growth. Housing prices are positively correlated to retail sales. Income growth has a much stronger relationship to sales performance than static income levels. Ethnicities and incomes are sorted and stratified in dense markets, making performance forecasting more nuanced. Relatively higher Internet usage in a metro corresponds to significantly higher brick-and-mortar retail sales. / by Kevin William Fagan. / 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, 2017. / Cataloged from PDF version of thesis. / Includes bibliographical references (pages 51-54). / Through most of history cities have grown slowly, organically following the contours formed by the intersection of geography and commerce - with occasional guidance from master planners - to create resilient and equitable forms. But the industrial age begat zoning, new forms of taxation, and hastened infrastructure investments, all of which upended centuries of measured and incremental growth. Codified separation of distinct land uses required new methods of real estate taxation and enabled new forms of value creation. Time and cost savings in infrastructure construction facilitated exponential growth in the speed at which a city's form could change. Amidst the quickening morphosis, the city's ability to diligently and thoughtfully create urban forms that maximize equity for all stakeholders has been diminished; bureaucratic barriers to housing production increased costs, and necessitated subsidization in order to create affordable housing. In order to reenergize the city's ability to create an equitable city, we must reexamine our use of land-use regulations, tax policies, and formulate clear ways forward. This thesis first seeks a broad and versatile definition of an equitable city in order to understand the desired end-state of potential interventions. Second, the author explores the formal characteristics of the equitable city, the way current land-use regulations are either facilitating or impeding the creation of that form, and the potential for a better way forward. Third, the author taxonomizes the fiscal tools available to the city which influence the urban form. Lastly, the author looks at the Highland neighborhood of Austin, TX - a marginal neighborhood with recently completed light-rail stops, a regional mall being redeveloped into a mixed-use project anchored by a community college, and building typologies which do not comply with current zoning - and proposes palatable changes to the way real estate is taxed, which will facilitate the creation of a more just, equitable, and sustainable neighborhood. / by Witt McCall Featherston. / 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 59-61). / The real estate industry is very conservative and risk averse, yet innovation is critical to its long term viability. While innovation does occur in real estate development, it is often discouraged and not the standard approach. This thesis focuses on understanding the motivations and obstacles facing real estate developers who decide to pursue innovative products, processes and systems. The study explores the challenges of developing co-living, a recent innovative real estate product in order to understand why this product is taking off across the country, and how it has been implemented in Boston and New York City. Insight into the innovation processes are derived from site visits and multiple interviews with professionals from different sectors of real estate: developers, consultants and regulatory authorities. The thesis concludes by describing five principles of innovative real estate development, relating to: Market Demand, Vision, Adoption, External Forces and X-Factors. While these principles are derived from experience in creating co-living projects, they are illustrative and important for the innovation process in all types of real estate products. / by David S. Drobnis. / 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 , 2010. / Cataloged from PDF version of thesis. / Includes bibliographical references (p. 71-72). / This thesis explores the topic of diversification opportunities in international real estate, with focus on private real estate markets in developed countries. In examining the characteristics of returns and interrelatedness between international real estate, stocks and bonds markets from the time period spanning 2000 to 2009, we find that 2008 was the only year within the past decade in which several countries saw synchronized negative returns on a calendar year basis in the stocks and real estate markets, and even so the synchronized negative returns was only experienced by half of the countries within the 10-country opportunity set. The amplitude of the peak to trough drop in the cumulative value of the assets was small in real estate on average relative to that of stocks. These findings suggest that investors' should benefit from holding international real estate within their portfolios, even in an extreme down market. Modern portfolio theory is used to analyze and compare ex-ante diversification opportunities in international real estate, stocks and bonds and domestic diversification opportunities for the three asset classes from the perspectives of U.S. and European investors. We project expected returns for each of the markets and used historical risks (volatility) from the 2000-2009 period as estimates for volatility. When returns are calculated in local currencies, international diversification in the real estate portfolio (diversified within a 10-country opportunity set) should help U.S. investors substantially improve their portfolio risk-return efficiency relative to domestic diversification (within a 6-metropolitan area opportunity set), as the markets within the U.S. domestic opportunity set provide unattractive risk-return efficiency and their movements are highly correlated. By contrast, European investors will benefit less from the same international diversification strategy relative to domestic diversification (within 5 Eurozone countries) as several Eurozone markets are able to provide considerable risk-return efficiency and low correlations can be found in some pairs of markets. Applying home bias and limits on exposure to any single country i.e. country caps to the portfolio allocation helps to balance the allocation weights for the investor's portfolio but also significantly limits the investor's ability to take advantage of diversification opportunities provided by the international markets. When returns are calculated in the investors' domestic currencies, additional currency risk increases the portfolio volatility without providing additional expected return, reducing diversification benefits of international real estate. Even so, international diversification potential to U.S. investors should still be considerable, while that to European investors' should be minimal. / by Onousa Boontanorm. / 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. 125-128). / In recent years, global real estate investment has become an important component of efficient global mixed asset portfolios. Although these investments carry increased political, regulatory and currency risk, international real estate investment has been on the rise. Compelling macroeconomic and demographic trends along with improvements in structural and regulatory conditions and investment in infrastructure are driving strong real estate capital flows into the emerging markets. This thesis provides a study of the opportunities and challenges of investing in one emerging market, India. With a population of over 1 billion, India has been a major beneficiary of the "Globalization of Real Estate". This thesis identifies the opportunities in India that have caused global capital to flow into Indian real estate and the key factors driving Indian real estate. It explains the challenges of investing in Indian real estate and seeks to provide strategies for navigating the real estate landscape in India. / by Kunal Wadhwani. / 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, 2015. / Cataloged from student-submitted PDF version of thesis. / Includes bibliographical references (pages 92-93). / Situated in the middle of the capital stack of a property, mezzanine financing in real estate has been established in the form of B-notes, mezzanine loans and preferred equity, allowing the borrower to reduce its equity investment. Emerged in the early 2000's, the US real estate mezzanine market has rapidly expanded mainly due to the credit crunch following the Global Financial Crisis that widened the funding gap between the senior debt and the borrower's equity and, thereby, opened investment opportunity for mezzanine lenders to fill the gap. Meanwhile, major Korean institutional investors, categorized into pension funds, mutual aid associations, life insurers and a sovereign wealth fund, had increasingly invested in foreign real estate, particularly in the form of equity investments in order to enhance investment returns and diversify their portfolio. As asset prices are approaching the pre-crisis level, however, they have started invested in debt products instead of equity investment, focusing on mezzanine debt mainly in the US and UK markets. The purpose of this thesis is to identify the mezzanine investment opportunity in the US real estate market for Korean institutional investors. The US real estate mezzanine investment section introduces the elements of the mezzanine market and investigates the emergence and evolution of the market and specific investment strategies through publication review and an open-ended interview with a US investment manager. The Korean institutional investor section introduces the profile of major Korean institutions and looks into the market environment that led them to move toward debt away from equity and to prefer mezzanine debt for their overseas real estate investments through market research and open-ended interviews with major Korean asset managers. This thesis ends with defining mezzanine investment opportunity and risk in the US real estate market for Korean institutional investors. After a thorough research, it is found that the US mezzanine market is expected to keep creating investment opportunity as long as the funding gap exists. Also, the research makes it clear that mezzanine debt commands higher returns compared to levered equity investment, drawing Korean institutions who pursue higher risk-adjusted returns while avoiding equity investment due to compressing cap rates. As being most advanced, experienced, established and biggest, the US mezzanine market can be the best target market for Korean institutions. However, they have to take into account the current issues of diminishing premium on mezzanine debt and increasing default risk. / by Sang Hoon Jeon. / S.M. in Real Estate Development