Thesis (S.M. in Real Estate Development)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning, Center for Real Estate, 2008. / This electronic version was submitted by the student author. The certified thesis is available in the Institute Archives and Special Collections. / Includes bibliographical references (leaves 97-102). / Croatia stands true to its marketing slogan, "the Mediterranean as it once was", with tiny tiled-roof villages dotting the unspoiled coastline-- but for how long? Since it declared independence from Yugoslavia in 1991, Croatia has been on the rise attracting tourists to its Adriatic coastline and over 1000 islands, reaching its prewar tourism numbers when it led the market as the top destination for European vacationers. Investors, speculators and developers have all followed suit, attempting to take advantage of the beautiful coastline and growing market. However, developers have had minimal success navigating through the overly restrictive planning and permitting bureaucracy. In the meanwhile, two to four story apartment hotels have sprung up like wild fire (legally and illegally) and are dominating the coastal accommodations and threatening the natural landscape. As most of the Mediterranean coastlines are 70% developed, Croatia maintains only 15% of its coast developed; creating a strong comparative advantage that must be preserved and strategically utilized. The current system does not have a vision of how to accomplish this. An analysis of the sustainability of the coastal development process in Croatia was conducted beginning with an intense review of available literature, followed by a series of personal interviews with key figures in the market. The seven coastal counties of Croatia were visited during the interview process where developers, architects, city and state officials, business consultants, lawyers, academics and investors shared their knowledge about the opportunities and challenges of this exciting market. Economic drivers, land use policy, design, financing, infrastructure capacity and operations were all reviewed as key elements of the development process. / (cont.) An analysis of these elements produced a final recommendation establishing a vision for the Croatian coast and an Adriatic Coastal Planning Policy to carry out that vision for generations to come. / by Bozho J. D. Deranja. / S.M.in Real Estate Development

Thesis (M.C.P.)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning; and, (S.M. in Real Estate Development)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning, Center for Real Estate, 2008. / Includes bibliographical references (p. 58-64). / Massachusetts General Laws Chapter 40B, also known as the "anti-snob zoning law", has become one of the state's most prolific affordable housing development tools: in the years since its passage in 1969 its provisions have facilitated the development of over 48,000 housing units, including approximately 26,000 units reserved for residents at or below 80% of area median income. However, controversy has followed 40B hand in hand for almost the entirety of its four-decade existence. I argue that in recent years 40B opponents have created a new rhetorical strategy, turning the traditional pro-affordability stance on its head to argue against 40B. In this newest iteration of the 40B debate, opponents of the law are cast as supporters of affordable housing. Tracing a history of traditional 40B opposition tactics and the ways in which pro-affordable housing advocates have responded, I arrive at the present time and describe the manner in which this new argument is applied in public discourse. Because of its novelty, relatively little research has been undertaken to address the claims of the pro-affordability, anti-40B position. I examine current arguments, concluding that the claim 40B developments provide only a minimal level statutorily required affordable housing, while catering to the rich, offers the most promising research opportunity to bring quantitative analysis to a current point of contention in the 40B debate. / by Theodore E. Schwartzberg. / S.M.in Real Estate Development / M.C.P.

Thesis (M.C.P. )--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning; and, (S.M. in Real Estate Development)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning, Center for Real Estate, 2006. / This electronic version was submitted by the student author. The certified thesis is available in the Institute Archives and Special Collections. / Includes bibliographical references (leaves 101-103). / Since 1995, the government has launched brownfield financing programs to promote brownfield cleanup and redevelopment in the United States. These programs have lowered financial barriers for brownfield developers and returned vibrant properties to communities. In this study, I focus on examining the efficiency of these incentives from the social perspective and proposing optimal funding decision rules. I hypothesize that brownfield funds are not allocated optimally in some cases. First, I investigate the current brownfield financing programs at federal, state, and local levels. Second, based on externality and welfare economics theories, I propose an optimal funding-decision flow chart. Third, by testing my hypothesis on three brownfield cases in Massachusetts, I perform social benefit-cost analyses and determine whether brownfield funds were justified by their social returns. Finally, I discuss the major findings from these case studies and point out ways to improve current brownfield financial and non-financial policies. Based on theoretical analyses, I propose that the government should not sponsor projects with positive private net present values, but rather focus on projects that have positive net present social values and not feasible without subsidies. / (cont.) In the real world, it is difficult to measure the social benefits of a brownfield redevelopment accurately, especially before a development project is completed. Hedonic models show that only one of three cases exhibit significant positive enhancement on housing values after redevelopment.. Only development of a simple rule-of-thumb benefit assessment toll would make an optimal brownfield funding decision possible. / by Rongtao Xu. / S.M.in Real Estate Development / M.C.P.

Thesis (M.C.P.)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning; and, (S.M. in Real Estate Development)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning, Center for Real Estate, 2006. / This electronic version was submitted by the student author. The certified thesis is available in the Institute Archives and Special Collections. / "September 2006." / Includes bibliographical references (p. 104-110). / This thesis explores the paradox faced by 25-34 year-old, White, well-educated persons who choose to live in predominantly low-income neighborhoods. In particular, this thesis asks if gentrifiers are aware of gentrification and their role in it, and then how they navigate that paradox. The thesis is grounded in interviews with residents of three Boston neighborhoods that are in various stages of gentrification: the South End, Jamaica Plain, and Dorchester. The interviews are framed within a synthesis of academic theory, a description of the introduction of the term "gentrification" to the United States, and common perceptions of gentrifiers as portrayed in academic and popular cultural. This framework is meant to expose the difficulty of using the term consistently, and its emotional power. Readers who are not familiar with the term or its complex background should find this framework helpful in forming a basic and thoughtful understanding. More advanced readers should use this thesis to critically explore their own position and build a more sophisticated understanding. Though the core meaning of the term "gentrification" has not changed substantially from its original definition in 1964, a wide variety of qualifiers have been attached to the term resulting in highly positive and highly negative connotations. / (cont.) One explanation for these wildly varying perspectives is that gentrification is a topic that reflects larger human issues such as self and group identity, as well as socio-economic class. The result is twofold. One, these issues are so fundamental that discussions involving them have highly emotional stakes. Two, the topic brings together interdisciplinary academics and practitioners who often have conflicting paradigms and perspectives. Many of the gentrifiers reported that they live in their neighborhood due to practical matters, such as affordable homeownership, as well as less easily defined concerns, such as the sense of belonging to a diverse community. Nearly all of the gentrifiers expressed inner conflict over being a potentially negative force in the neighborhood, and a large number described ways they attempted to mitigate or explain away that force. Using the reflections of this group of gentrifiers to better understand their motivations and concerns, should enable community planners and real estate developers to work more successfully in gentrifying neighborhoods by tapping into the human, social, and economic capital brought by gentrifiers. Planners and developers are encouraged to take a mutual gains approach, emphasizing opportunities for connection rather than polarization. / by Alison Elizabeth Novak. / S.M.in Real Estate Development / M.C.P.

Thesis (M.C.P.)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning; and, (S.M. in Real Estate Development)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning, Center for Real Estate, 2008. / This electronic version was submitted by the student author. The certified thesis is available in the Institute Archives and Special Collections. / Includes bibliographical references (p. 54-56). / This paper examines why and how publicly-traded home builders might use index-based residential property derivatives to manage risk. After describing a number of alternative reasons for hedging, I argue for a paradigm for risk management proposed by Kenneth Froot, David Scharfstein and Jeremy Stein and augmented by Antonio Mello and John Parsons. According to this paradigm, the objective of hedging is to increase a firm's financial flexibility by maximizing its liquidity - slack in the form of cash or unused debt capacity - when falling output prices reduce income and make it difficult to raise external financing, but do not reduce the firm's need for funds. An important implication of this paradigm is that attempting to eliminate volatility in the value of a firm is not an optimal hedging objective, and attempting to do so can, in fact, reduce the value of the firm. To illustrate how this paradigm might be used by public home builders it is applied to two hypothetical firms, each with a different capital structure and regional focus, and the potential benefits of hedging for each firm is discussed. The discussion then turns to the available real estate derivative products and how they can be employed as hedging vehicles. Key issues pertaining to the design of hedging vehicles are examined, including 1) how to choose a derivative contract, 2) how to choose an index or indices to use as the asset underlying the hedging vehicle and 3) how to address misalignment between the time to expiration of available derivatives contracts and the development time frames of residential communities. Evidence is presented that suggests hedging vehicles based on multi-market composite indices will probably have too much basis risk to effectively hedge against downturns in the prices of some builders' homes. / (cont.) Finally, I describe a methodology for determining whether and how much a firm should hedge. / by Quinn W. Eddins. / S.M.in Real Estate Development / M.C.P.

Thesis (S.M. in Real Estate Development)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning, Center for Real Estate, 2008. / This electronic version was submitted by the student author. The certified thesis is available in the Institute Archives and Special Collections. / Includes bibliographical references (leaves 79-81). / This thesis attempts to explore the relationships between the Buildings Sector, energy efficiency and global warming. Through a qualitative analysis the author illustrates the connection between these three areas and shows how both energy efficiency, as a key policy measure, and the Buildings Sector, as the key recipient of such policies, can act together to significantly mitigate the effects of global warming and resulting climate change. First, the reader is given the tools to understand the issues surrounding global warming and climate change. This is accomplished through an overview of related science, history and environmental and economic impacts. Future climate scenarios are explained and mitigation options are offered. Second, an overview of energy efficiency as the primary mitigation option for global warming is given. Terminology, history and mitigation potential of energy efficiency and how it applies across market sectors are reviewed. Barriers to implementation of energy-efficiency projects and the need for strong policy are also explored. Third, the Buildings Sector, showing the most promise for greenhouse gas mitigation through energy-efficiency investments, is analyzed. This analysis focuses on the current consumption patterns of buildings, on available energy-efficient technologies, and on the characteristics of efficiency projects in buildings and how they support the goals of broader climate change policy. The analysis concludes with a review of the barriers to such projects along with an overview of the policies in place meant to overcome these barriers. Finally, the author summarizes her research and offers her conclusions. / by Donna K. DiBona. / S.M.in Real Estate Development

Thesis (S.M. in Real Estate Development)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning, Center for Real Estate; and, (M.C.P.)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning, 2008. / This electronic version was submitted by the student author. The certified thesis is available in the Institute Archives and Special Collections. / Pages 133 to 136 in 2 folded leaves. / Includes bibliographical references (p. 129-132). / This thesis examines the recent worldwide boom in megacity development. Its basis is a global survey of megacity building that quantifies the amount of current development and qualifies the various city types and themes, the countries in which megacities are being built, and the firms that are building them. The key findings from the survey are summarized and analyzed, followed by a closer look at some of the leading city building firms and their role in the global megacity building industry. Next, is an investigation of the critical reasons why city building is occurring on such a massive scale, which together with the survey findings sets the framework for three possible distinct megacity market models. The thesis continues with case studies of three new cities, each with their own unique theme and reasons for being developed. Finally, the megacity phenomenon is assessed from the perspective of broader issues such as sustainability and social impact, and summary conclusions are drawn. / by Steven P. Weikal. / M.C.P. / S.M.in Real Estate Development

Luxembourg has seen an unprecedented rise in homeownership prices in the last decade, hinting the existence of a speculatory bubble. Housing bubbles can have catastrophic effects on surrounding economies, so identifying them is paramount. This paper investigates Luxembourg’s housing prices and related factors in search for evidence of this bubble. The method consists of a two-stage econometric analysis of homeownership prices (dependent, HPI used for proxy) and its determining factors (independent, e.g. interest rates, incomes, population, etc.) spanning the last 15 years. First, all the time-series are tested for stationarity using the Augmented Dickey-Fuller test. Second, homeownership prices are tested for bivariate cointegration with the independent variable time-series using the Engle-Granger method. Cointegration of time-series is evidence of a shared long-run equilibrium, so absence of such relationships indicates market dysfunction. Under specific conditions, a speculatory bubble becomes the likely culprit. We identified no strong, statistically significant cointegrating relationships between homeownership prices and any of their determining factors. In combination with other indicators, we consider this to be admissible evidence for the existence of a bubble in Luxembourg’s housing market. We also suggest policy measures that could alleviate this potential bubble and discuss their likely outcomes.

Recent demographic studies suggest a shift in consumer preference away from auto-centric suburban housing to more walkable suburban communities. In response to these changes, efforts have been made to model the walkability of a location and determine its effect on the market value of both residential and commercial real estate. Existing walkability models have considered the importance of amenities and potential pedestrian routes, but have neglected to identify the importance of pedestrian surfaces such as sidewalks and trails as a proportion of the route traveled, and have typically modeled pedestrian movement using exclusively street or trail centerline data. The following paper uses a new walkability model to provide insight on the effect pedestrian surfaces along these amenity routes have on the market value of single family detached and semi-detached homes in Fairfax County, VA. It was found that increases in pedestrian surfaces along amenity routes had little to no effect on home value, but that 3.3%, 1.2 %, and 0.7 % price premiums existed for single family homes that had amenity paths of less than 1 mile to public transportation, public spaces, and recreational facilities, respectively. Price reductions of 3.0 % were discovered for homes that had amenity paths within 1 mile of retail locations. / Master of Science

In these three essays, I examine the relationship between housing prices and civil disturbances. In the first essay, I examine the Ferguson Unrest in 2014 following the killing of Michael Brown. Using a hedonic model and a repeat sales model using data from ZTRAX, I find a highly significant negative affect around the events temporally and spatially. In the second essay I examine house price indices across the US during the onset of COVID and during the protests following the killing of George Floyd. I use the Zillow Home Value Index and I find cities which experienced protests experienced less growth than those which did not, and COVID requirements have a heterogeneous effect dependent on enforcement. The severity of the negative effect of the protest depends on protest size and the interaction between the COVID lockdown requirements. In the third and final essay, I continue using the Zillow Home Value Index and find the George Floyd protests had spillover effects into adjacent municipalities within the same metropolitan statistical area. Cities which experienced protests which resulted in a death experienced spillover effects with the adjacent municipalities having a statistically and economically significant reduction in housing price growth, but less severe than the city where the protest took place. Taken together the essays contribute to the literature on civil disturbances and their relationship with housing prices, the literature on crime and its relationship with housing prices, and the literature on COVID-19 restrictions and their relationship with housing