Masterclass Real Estate Financial Modeller

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Course Overview

The recent turmoil in world financial markets, which has been closely tied to events in the real estate market, suggests that investors, lenders, and others who participate in the real estate market need to better understand how to evaluate the risk and return associated with the various ways of investing and financing commercial and residential real estate.The course is designed not only to help delegates understand the characteristics of the various vehicles for lending and investing in real estate, recognize the valuation techniques practically utilized in the valuation of properties, comprehend the full picture of risk-return analysis in the real estate market, but also to model these concepts in best-practice Excel models. This is the only way to make sure that delegates can apply these concepts professionally and to avoid costly mistakes.Concepts and techniques included in this 5-days intensive program course are used in many careers related to real estate. These include investing, development financing, appraising, consulting, managing real estate portfolios, leasing, managing property, and managing corporate real estate. This material is also relevant to individuals who want to better understand real estate for their own personal investment and financing decisions.

Key Takeaways

Learn how to create a valuation framework for analyzing the financial performance of commercial and investment real estate.
Learn how to build your own risk analysis and development cost monitor within your models.
Evaluate the outcome of different valuation techniques and recognize the cost of capital for real estate and implement discounted cash flow techniques.
Learn the methods of practical application of valuation models in investment analysis.
Understand the most widely-practiced property income valuation techniques and be able to critically analyses a real estate investment proposal.

International Academy of Business and Financial Management
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The International Academy of Business and Financial Management™ is one of the world’s fastest growing professional association with more than 200,000 members, associates and affiliates in 145 countries. IABFM™ hosts and organizes certification training worldwide and offers exclusive board designations to candidates who meet the highest professional standards and assessment criteria. The IABFM is credited by the American National Standards Institute (ANSI) the International Standards setting authority.

Course Outline

Day 1
Real Estate Investment: Basic Concepts
Two General Classifications of Estates Estates Not Yet in Possession (Future Estates) Examples of Leasehold Estates Interests, Encumbrances, and Easements Methods of Title Assurance Abstract and Opinion Method The Title Insurance Method Limitations on Property Rights Notes and mortgages Seller financing Reconstructing a mortgage loan
Important mathematics in real estate
Compound Interest Compound or Future Value Yields on Investment Annuities Calculating Compound Interest Factors Equivalent Nominal Annual Rate (ENAR): Extensions Solving for Annual Yields with Partial Periods: An Extension Present Value A Graphic Illustration of Present Value
Residential housing projects - Single Family Housing: Pricing, Investment, and Tax Considerations
Overview House Prices Income and Employment Renting versus Owning Analysing expected house prices Economic Base Analysis—Location Quotients Capitalization Effects: Price Premiums Investing in “Distressed Properties” Financial Framework for Analysing Distressed Properties
Day 2
Residential housing projects - Underwriting and Financing Residential Properties
Underwriting Default Risk Classification of Mortgage Loans Conventional Mortgage Loans Insured Conventional Mortgage Loans FHA Insured Mortgage Loans VA Guaranteed Mortgage Loans The Closing Process Fees and Expenses Prorations, Escrow Costs, and Payments to Third Parties Establishing the APR under Federal Truth-in-Lending Requirements ARMs and Truth-in-Lending Disclosure
Income-Producing Properties: Leases, Rents, and the Market for Space
The “Market” for Income-Producing Real Estate Income Potential—Real Estate Assets Vacancy Underwriting Tenants General Contents of Leases Leases and Rental Income CAM Charges—Recoveries Pro Forma Statement of Cash Flow—Retail Properties
Case Example: Apartment Properties
Valuation of Income Properties: Appraisal and the Market for Capital
Introduction Valuation Fundamentals Appraisal Process and Approaches to Valuation Sales Comparison Approach Mortgage-Equity Capitalization Reconciliation: Sales Comparison and Income Capitalization Approaches Valuation Case Study—Oakwood Apartments ARGUS SolutionIncome Approach
Investment Analysis and Taxation of Income Properties (when investing in tax-paying countries)
Motivations for Investing Real Estate Market Characteristics and Investment Strategies The Real Estate Cycle Investment Strategies Market Analysis Supply of Space Market Rents Forecasting Supply, Demand, Market Rents, and Occupancy Making Investments: Projecting Cash Flows Effective Tax Rate A Note about Passive Losses Special Exceptions to PAL Rules Approaches to Metro Area Market Forecasting: Basic Concepts and Data Sources
Day 3
Financial Leverage and Financing Alternatives
Introduction to Financial Leverage Conditions for Positive Leverage - Before Tax Conditions for Positive Leverage - After Tax Break-Even Interest Rate Risk and Leverage Underwriting Loans on Income Properties Market Study and Appraisal Lender’s Yield on Convertible Mortgages Comparison of Financing Alternatives Monument Office Building Example - ARGUS Solution with a Loan Other Financing Alternatives
Risk Analysis
Introduction Comparing Investment Returns Types of Risk Due Diligence in Real Estate Investment Risk Analysis Sensitivity Analysis Partitioning the IRR Variation in Returns and Risk Risk and Leverage A “Real Options” Approach to Investment Decisions Traditional Approach to Land Valuation
Disposition and Renovation of Income Properties
Disposition Decisions A Decision Rule for Property Disposition IRR for Holding versus Sale of the Property Return to a New Investor Marginal Rate of Return Refinancing as an Alternative to Disposition Renovation as an Alternative to Disposition Renovation and Refinancing Rehabilitation Investment Tax Credits Low-Income Housing
Day 4
Financing Corporate Real Estate
Lease-versus-Own Analysis Leasing versus Owning—An Example Cash Flow from Leasing Cash Flow from Owning Refinancing Investing in Real Estate for Diversification Real Estate Asset Pricing and Capital Budgeting Analysis: A Synthesis
Financing Project Development
Introduction Overview: The Planning Process The Development of Income-Producing Property Market Risks and Project Feasibility Project Risks Project Development Illustrated Sensitivity Analysis, Risk, and Feasibility Analysis
Financing Land Development Projects
The Land Development Process—An Overview Financing and Development Lender Requirements in Financing Land Development Detailed Cost Breakdowns Residential Land Development Illustrated Estimating Development Cost and Interest Carry
Structuring Real Estate Investments: Organizational Forms and Joint Ventures
Introduction Sole Proprietorships Partnerships Limited Liability Companies Operating Projections Statement of Before-Tax Cash Flow (BTCF) Investment Objectives and Policies Promoters’and Managers’Compensation Investor Suitability Standards
Day 5
How can you list in the US as Real Estate Investment Trusts (REITs) ?
Introduction Legal Requirements Tax Treatment Violation Penalties and Status Termination Taxable REIT Subsidiaries Types of Trusts Equity Trusts Use of Straight-Line Rents FFO and Income from Managing Other Properties Valuing REITs as Investments Valuation of Midwestern America Property Trust
Real Estate Investment Performance and Portfolio Considerations
Introduction The Nature of Real Estate Investment Data Sources of Data Used for Real Estate Performance Measurement NCREIF Property Index: Property Values Data Sources for Other Investments Calculating Portfolio Returns Portfolio Risk
Practical Case Study: Full Excel model of real estate investment decision analysis of a residential compound in Saudi Arabia including 40 villas with full details including assumptions, waterfall analysis, sensitivity analysis, development cost monitor, project return vs equity return, return on investment and investment management fees among others. It is the model that top professionals typically use in the region.

Who Should Attend?

This highly practical and interactive course has been specifically designed for
This course is aimed at people with several years’ real estate or finance/investment experience:
→ Real estate investors and analysts
→ Real estate managers
→ Planning and development professionals in real estate businesses
→ Property Developers
→ Bankers and lenders
→ Corporate financiers
→ Real Estate Portfolio managers
→ Finance managers and analysts
→ Property owners
→ Hedge fund managers
→ Mortgage brokers
→ Private banking Relationship managers responsible for Real Estate Investments
→ Anyone pursuing career in real estate

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What language will the course be taught in and what level of English do I need to take part in an LEORON training program?
Most of our public courses are delivered in English language. You need to be proficient in English to be able to fully participate in the workshop and network with other delegates. For in-house courses we have the capability to train in Arabic, Dutch, German and Portuguese.
Are LEORON Public courses certified by an official body/organization?
LEORON Institute partners with 20+ international bodies and associations.We also award continuing professional development credits (CPE/PDUs) for:1. NASBA (National Association of State Boards of Accountancy) 2. Project Management Institute PDUs 3. CISI credits 4. GARP credits 5. HRCI recertification credits 6. SHRM recertification credits
What is the deadline for registering to a public course?
The deadline to register for a public course is 14 days before the course starts. Kindly note that occasionally we do accept late registrations as well, but this needs to be confirmed with the project manager of the training program or with our registration desk that can be reached at +1071 4 1075 5711 or
What does the course fee cover?
The course fee covers a premium training experience in a 5-star hotel, learning materials, lunches & refreshments, and for some courses, the certification fee and membership with the accrediting bodies.
Does LEORON give discounts?
Yes, we can provide discounts for group bookings. If you would like to discuss a discount on a corporate level, we will be happy to talk to you.