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. 54-55). / The global economic expansion and subsequent creation of wealth as well as increased purchasing power and disposable income has contributed to the growth in the secondary home market. Over the past decade developers that cater to such discerning buyers have focused significantly on bringing to market products that will meet the wants, needs, and expectations of their target customers. Despite the significant growth in the secondary home market and general infatuation that most individuals have with real estate, there are limited studies that analyze the second home market. Instead most research has focused on the commercial and primary home real estate markets. This study examines a specific development, The Sporting Club at The Greenbrier Resort in White Sulphur Springs, WV. The study focuses on the residential home price transactions that occurred at The Greenbrier Resort since 1980. The data collected from the Greenbrier County Assessor!s Office will be used to derive a hedonic price equation. This equation will help to explain the value derived from key home attributes; beds, baths, home square footage, and location. Then a nominal and real price index will be constructed and used to understand the correlation between home prices and supply and GDP. The end goal is to calculate, through regression analysis, a price equation with the dependent variable price and independent variables of supply and demand (GDP) and a supply equation. The analysis has three conclusion sections. The first is the hedonic price equation that implies the law of marginal utility is recognized with respect to the number of bedrooms a home has and that any more than three a negative affect on price occurs. However, with respect to bathrooms, additional bathrooms do add to the price of the residence. The second and third conclusions are derived from time series equations. The first explains that for every increase by 1% in GDP the real price of a property increases by $4,332. The second equation tries to explain supply and concludes that a 5% increase in the real price index causes a 5.4% increase in supply or unit supply elasticity is observed. A recommendation for the owner/developer of The Greenbrier Sporting Club is to buyback vacant lots because currently 78% of the supply is in control of the owners. This phenomena will most likely lead to future price volatility as supply will be delivered to the market as families and speculators chose. In other words supply will not be delivered to the market at a rate that will stabilize prices. / by Hunter L. Kass. / 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, 2015. / Cataloged from PDF version of thesis. / Includes bibliographical references (page 48). / The current generation of young adults dubbed the "Millennials" are far different from past generations in many ways. They prefer renting to owning, shun the suburbs for cities, are likely to live at home with their parents, are putting off marriage and they are well educated. This thesis seeks to study how the living arrangements of the Millennial generation compare to those of the past generations to find out how true this conventional wisdom is. It studies U.S. Census Data from past decades, focusing on the population segment between ages 22 and 31 at each decennial census from 1980-2010. The demographic characteristics of age, marriage and education are studied to determine their influence on the living arrangements of this young adult cohort. Using linear regression models, the propensity to live in different forms of tenure or within a center city of and MSA are parsed out to find what portion of this propensity is due to the delay of marriage, increase in education or changes in the young adult population. The study is then further broken down to determine to what extent changes in living arrangements are due to changes in the preferences of the population versus changes in the demographic composition of the population. From 1980-2010 there has been a decline in the marriage rate and homeownership rate of the population, markedly so amongst young adults. Conversely, there has been an increase in those completing four years of college and the rate of the population living in a home where their parent is the head of household. This study shows that the decline in marriage has reduced the homeownership rate, but there is an increased preference for homeownership amongst those never married especially so amongst young adults. In general there has been a large increase in the preference of young adults to live at home and a decline in the preference to own or rent indicating that those not buying are opting to move in with their parents rather than rent. There has not been an increase amongst Millennials in preference or total propensity to live in center cities. / by David William Roache. / 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 59-60). / This thesis explores the development potential and land value of a vacant parcel of land listed for sale in Dallas, TX. Further, this thesis proposes three different multifamily rental site plan designs for the parcel in an effort to maximize the value of both the development and the land. The site is located just two blocks from Dallas' popular Bishop Arts retail district. This area has seen a renaissance and has become a desirable location to live over the last several years for residents who might not have considered the location previously. The development potential of the site is restricted by its zoning designation, which does not allow for mixed-use developments, its height restrictions, its parking requirements and its lack of scale - the site is quite small and rectangular. The zoning of this and the surrounding parcels aims to create an urban residential area that is walkable and pedestrian friendly, reducing traffic overall. Pedestrian permeability and the character of the Bishop Arts District should be considered in the design. Seen through the lens of a real estate developer evaluating a business opportunity, this document is formatted in sections focusing on the economic and real estate potential of the city of Dallas, the Bishop Arts area and the parcel itself, the parcel's zoning and parking issues, alternative design schematics for the parcel, and prevailing financial metrics of Dallas, Bishop Arts and the multifamily sector as they relate to each design's projected financial performance. This thesis concludes with a determination of the ultimate land value as dictated by the most financially successful site plan. / by Justin L Rice. / 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. / Page 66 blank. Cataloged from PDF version of thesis. / Includes bibliographical references (pages 64-65). / Converting existing office properties into residential units offers an innovative method to unlock additional value for real estate in the Central Business District (CBD) of certain major cities. Today, however, this form of adaptive reuse is not considered to be a distinct product category. It is instead viewed as a collection of one-off instances of success driven by exceptional circumstances and unique donor buildings. This thesis will identify key commonalities to value creation that make the approach both replicable and transferable. The following analysis will demonstrate that successful office to residential conversion is not a unicorn within the built environment, but rather a viable strategy to see and find value where others do not. Although, a number of factors have combined to make adaptive reuse a highly profitable activity, there are three main elements that underpin the equation: demand, design, and flexibility. Firstly, the change in usage is the result of current trends causing a shift in the Highest and Best Use (HBU) for those structures. Further driving the emergence of office to residential conversion is innovation in building designs. Office layouts have evolved over time from traditional forms with individual work spaces into open floorplan arrangements. Simultaneously, residential layouts have moved away from standard designs towards including an interior extra bedroom or den. The key to driving value from a conversion is for the finished product to be perceived by the market as new supply. Finally, the flexibility to change product type and extend the existing structure increases profits beyond normal levels. Increased net square footage acts as a multiplier to increase the value created through residential conversion and design innovation. Adding net square footage typically occurs in three forms: maximization of site coverage, increased efficiency, and incremental floor count. As a result, it is no longer mandatory to demolish the old in order to make way for the new. Converting space from class B office to class A luxury residential offers a method to add incremental value to previously built real estate by leveraging these essential elements. / by John Endicott Birdseye Weil. / 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. 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.