everything.study
ESD.712

Tools for Analysis: Design for Real Estate and Infrastructure Development

Graduate · Historical course

Spring 2010

Topics

  • Introduction: course organization and learning objectives, uncertainty exercise, Garage case concepts
  • Discounting: standard and certainty-equivalence
  • Review of groups and projects
  • Economic model of options applied to real estate
  • Economic model of options (cont.): underlying asset dynamics and GIGO issues
  • Discussion of uncertainties in your projects
  • DSM questions and answers
  • Garage case: detailed analysis and exposition of “engineering analysis approach”
  • Experiment results presentation
  • Flexibility in real estate development – case examples of vertical and horizontal expansion
  • Scheduled reviews with teams: what does your model teach us?
  • Team presentations

Readings

  • [Geltner] = Geltner, David M., Norman G. Miller, Jim Clayton, and Piet Eichholtz. Commercial Real Estate Analysis and Investments . 2nd ed. Mason, OH: South-Western Educational Publishing, 2007. ISBN: 9780324305487.
    Listed reading
  • [de Neufville] = de Neufville, Richard, and Stefan Scholtes. Flexibility in Design . Cambridge, MA: MIT Press, 2011.
    Listed reading
  • Zhang, Na. “Difficulty in Identifying Trend and Volatility of Price Indices: Examples from International Real Estate Market.” MIT, 2010.
    Listed reading
  • de Neufville, chapter 1
    Listed reading
  • SES #: L2 · TOPICS: Discounting: standard and certainty-equivalence · READINGS: Geltner, chapter 10 (including appendix C)
    Reading assignment
  • SES #: L3 · TOPICS: Economic model of options applied to real estate · READINGS: Geltner, chapter 27
    Reading assignment
  • SES #: L4 · TOPICS: Economic model of options (cont.): underlying asset dynamics and GIGO issues · READINGS: Geltner, chapters 27 and 29 (appendix)
    Reading assignment
  • de Neufville, chapter 6
    Listed reading
  • Ohama, Dai. “Flexible Design of Airport System Using Real Options Analysis: Case Study of New Runway Extension Project of Tokyo international Airport.” 1.231 project, MIT, 2007.
    Listed reading
  • SES #: L10 · TOPICS: Flexibility in real estate development – case examples of vertical and horizontal expansion · READINGS: de Neufville, appendix
    Reading assignment
Sources