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Flexibility and real estate valuation under uncertainty : a practical guide for developers /
Provides a revolutionary conceptual framework and practical tools to quantify uncertainty and recognize the value of flexibility in real estate development This book takes a practical "engineering" approach to the valuation of options and flexibility in real estate. It presents simple simu...
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| Main Authors: | , |
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| Format: | Electronic eBook |
| Language: | English |
| Published: |
Hoboken, NJ :
John Wiley & Sons, Inc.,
2018.
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| Subjects: | |
| Online Access: |
Full text (Wentworth users only) |
MARC
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| 100 | 1 | |a Geltner, David, |d 1951- |e author. | |
| 245 | 1 | 0 | |a Flexibility and real estate valuation under uncertainty : |b a practical guide for developers / |c David Geltner, Massachusetts Institute of Technology, Cambridge, MA, USA, Richard de Neufville, Massachusetts Institute of Technology, Cambridge, MA, USA. |
| 264 | 1 | |a Hoboken, NJ : |b John Wiley & Sons, Inc., |c 2018. | |
| 264 | 4 | |c ©2018 | |
| 300 | |a 1 online resource | ||
| 336 | |a text |b txt |2 rdacontent | ||
| 337 | |a computer |b c |2 rdamedia | ||
| 338 | |a online resource |b cr |2 rdacarrier | ||
| 504 | |a Includes bibliographical references and index. | ||
| 505 | 0 | |a Intro; Title Page; Copyright Page; Contents; Foreword; Authorsâ#x80;#x99; Preface; Acknowledgments; About the Companion Website; Chapter 1 Discounted Cash Flow Valuation: The Basic Procedures and Concepts Underlying Spreadsheet Valuation Constitute the Springboard to our Approach of Analyzing Flexibility Under Uncertainty; 1.1 Why the Focus on the Discounted Cash Flow Model?; 1.2 Structure of a Discounted Cash Flow Spreadsheet; 1.3 The Cash Flow Projection; 1.4 Discount Rate; 1.5 Market Value and Forward-Looking (Ex-Ante) Analysis; 1.6 Backward-Looking (Ex-Post) Analysis; 1.7 Conclusion. | |
| 505 | 8 | |a Chapter 2 Economics of the Discounted Cash Flow Valuation Model: Understanding the Discount Rate is Critical2.1 Choice of Discount Rate; 2.2 Differences between Discount Rate, Opportunity Cost of Capital, and Internal Rate of Return; 2.3 Net Present Value; 2.4 Relationship between Discount Rate, Growth Rate, and Income Yield; 2.5 Relationship between Discount Rate and Risk; 2.6 Conclusion; Chapter 3 Future Scenarios Matter: We Need to Recognize that Future Projections are Uncertain; 3.1 The Standard Discounted Cash Flow Model Appears to be Deterministic. | |
| 505 | 8 | |a 3.2 We Live in a World of Uncertainty3.3 Discounted Cash Flow Pro Forma Cash Flows Are Expectations; 3.4 Flexibility and Options; 3.5 Conclusion; Chapter 4 Scenario Analysis: Future Scenarios can Significantly and Surprisingly Affect the Present Value; 4.1 Discounted Cash Flow Scenario Analysis; 4.2 Scenarios Affect Value; 4.3 Flexibility Has Value; 4.4 Conclusion; Chapter 5 Future Outcomes Cover a Range of Possibilities: We Can Describe Uncertainties in Real Estate Using Probability Distributions of Possible Future Outcomes; 5.1 Distribution of Future Outcomes. | |
| 505 | 8 | |a 5.2 Quantifying Input Distributions5.3 Distributions of Outcomes Differ from Distributions of Inputs; 5.4 Flaw of Averages; 5.5 Conclusion; Chapter 6 Simulation of Outcomes: Simulation is a Practical, Efficient Way to Explore Uncertainty and to choose between Alternative Strategies for Managing it; 6.1 Generating Scenarios; 6.2 Real Estate Simulation in a Nutshell; 6.3 Simulation Is an Efficient Process; 6.4 Number of Trials; 6.5 Conclusion; Chapter 7 Modeling Price Dynamics: Using Pricing Factors to Model the Dynamics of Real Estate Markets; 7.1 Pricing Factors; 7.2 Random Walks. | |
| 505 | 8 | |a 7.3 Real Estate Pricing Factor Dynamics7.4 Conclusion; Chapter 8 Interpreting Simulation Results: Target Curves and Scatterplots can be used to Graph the Distribution of the Sample Output; 8.1 Target Curves; 8.2 Comparing Target Curves; 8.3 Value at Risk; 8.4 Scatterplots; 8.5 Conclusion; Chapter 9 Resale Timing Decision: Analysis: Letâ#x80;#x99;s See what happens when we apply the Tools of Flexibility Analysis to a Classical Investment Decision: when to sell the Property; 9.1 The Resale Timing Problem; 9.2 Extending the Time Horizon of the Discounted Cash Flow Model; 9.3 IF Statements. | |
| 520 | |a Provides a revolutionary conceptual framework and practical tools to quantify uncertainty and recognize the value of flexibility in real estate development This book takes a practical "engineering" approach to the valuation of options and flexibility in real estate. It presents simple simulation models built in universal spreadsheet software such as Microsoft Excel®. These realistically reflect the varying and erratic sources of uncertainty and price dynamics that uniquely characterize real estate. The text covers new analytic procedures that are valuable for existing properties and enable a new, more profitable perspective on the planning, design, operation, and evaluation of large-scale, multi-phase development projects. The book thereby aims to significantly improve valuation and investment decision making. Flexibility and Real Estate Valuation under Uncertainty: A Practical Guide for Developers is presented at 3 levels. First, it introduces and explains the concepts underlying the approach at a basic level accessible to non-technical and non-specialized readers. Its introductory and concluding chapters present the important "big picture" implications of the analysis for economics and valuation and for project design and investment decision making. At a second level, the book presents a framework, a roadmap for the prospective analyst. It describes the practical tools in detail, taking care to go through the elements of the approach step-by-step for clarity and easy reference. The third level includes more technical details and specific models. An Appendix discusses the technical details of real estate price dynamics. Associated web pages provide electronic spreadsheet templates for the models used as examples in the book. Some features of the book include: • Concepts and tools that are simple and accessible to a broad audience of practitioners; • An approach relevant for all development projects; • Complementarity with the author's Commercial Real Estate Analysis & Investments--the most-cited real estate investments textbook on the market. Flexibility and Real Estate Valuation under Uncertainty: A Practical Guide for Developers is for everyone studying or concerned with the implementation of large-scale or multi-phase real estate development projects, as well as property investment and valuation more generally. | ||
| 588 | 0 | |a Online resource; title from digital title page (viewed on April 20, 2018). | |
| 650 | 0 | |a Real property |x Valuation. | |
| 650 | 0 | |a Real estate development. | |
| 650 | 0 | |a Real estate investment. | |
| 700 | 1 | |a De Neufville, Richard, |d 1939- |e author. | |
| 758 | |i has work: |a Flexibility and real estate valuation under uncertainty (Text) |1 https://id.oclc.org/worldcat/entity/E39PCGfmpHTBHxXrbrGtWmBGd3 |4 https://id.oclc.org/worldcat/ontology/hasWork | ||
| 776 | 0 | 8 | |i Print version: |a Geltner, David, 1951- |t Flexibility and real estate valuation under uncertainty. |d Hoboken, NJ : John Wiley & Sons, [2018] |z 9781119106494 |w (DLC) 2017051519 |
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