REMB38-Real Estate Funding

Module Provider: Real Estate and Planning
Number of credits: 20 [10 ECTS credits]
Level:7
Terms in which taught: Autumn term module
Pre-requisites:
Non-modular pre-requisites:
Co-requisites:
Modules excluded:
Current from: 2023/4

Module Convenor: Dr Yuan Zhao
Email: yuanyuan.zhao@henley.reading.ac.uk

Type of module:

Summary module description:

The module reviews the main sources of debt and equity funding available in real estate investment markets, presenting the implications for ownership, cash flows and rates of return. 

Aims:

The module will present and analyse several sources of funding and their pricing. The process of raising equity for private real estate investment will be introduced and examined. As far as debt funding is concerned, alongside traditional methods (e.g. private lending and mortgages), the module will review structured products and hybrid forms of financing. Particular emphasis will be given to the implications of different funding structures on returns that are achieved or are achievable by equity investors. 

Assessable learning outcomes:

Intended learning outcomes: 

The module aims to provide students with the core knowledge required to appreciate the unique characteristics of financing decisions in the context of commercial real estate. 

Assessable learning outcomes: 

Upon completion of the module, students should be able to: 

• apply finance theory to the fundingdecision process; 


• be familiar with the different sources of funding available for real estate investments;


• critically analyse the structure and pricing of each funding opportunity; 


• embed the funding choice within an investment decision process; 


• construct financing cash flows to enrich valuation models;


• analyse the return implications of funding choices for equity investors. 

Additional outcomes:

Cash flow modelling of project appraisal with different funding structures will enhance students’ analytical skills. 

Outline content:

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  Private lending and mortgages 

  
  

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  Structured finance 

  
  


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  Capital market products 

  
  


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  Hybrid finance 

  
  


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  Regulatory environment 

  
  


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  Implications of funding structures for risk and return 

  
  

Global context:

The literature and datasets that are referred to throughout the module provide a mixture of UK and international examples. 

Brief description of teaching and learning methods:

The module will be delivered as a block release with online support after the module has ended. The block release teaching will comprise lectures, seminars and problem solving workshops, with an individual assignment acting as a consolidating and integrating vehicle for the taught material. 

The block release taught element will be supported by the use of Blackboard. The module information, handouts, presentations and assignment will be s upplemented by use of discussion boards on technical aspects of the assignment and other material. 

Summative assessment- Examinations:

Summative assessment- Coursework and in-class tests:

20% of the assessment will be in the form of an online multiple choice test during the module week. The remaining 80% of the assessment will be an individual report based on Excel analysis with a word guide of 3,000 words (equivalent to a 4,000 word essay). 

Assignment Submission Deadline: Week 17

Formative assessment methods:

Informal feedback is accessible via seminars/tutorials during the teaching block week where key theoretical and empirical concepts are applied and tested. Communication via email and Blackboard is also a useful learning tool during the period after the teaching week. 

Penalties for late submission:

The Support Centres will apply the following penalties for work submitted late: 

• where the piece of work is submitted after the original deadline (or any formally agreed extension to the deadline): 10% of the total marks available for that piece of work will be deducted from the mark for each working day (or part thereof) following the deadline up to a total of five working days; 


• where the piece of work is submitted more than five working days after the original deadline (or any formally agreed extension to the deadline): a mark of zero will be recorded. 

The University policy statement on penalties for late submission can be found at:?https://www.reading.ac.uk/cqsd/-/media/project/functions/cqsd/documents/cqsd-old-site-documents/penaltiesforlatesubmission.pdf 

You are strongly advised to ensure that coursework is submitted by the relevant deadline. You should note that it is advisable to submit work in an unfinished state rather than to fail to submit any work. 

Assessment requirements for a pass:

The pass mark for this module is 50%.

Students completing the IPF Diploma and/or MSc IPF Entry route must achieve a mark of at least 50 in order to achieve the IPF Qualification. 

Reassessment arrangements:

Reassessment will be by the same method as for the module's original assessment requirements, subject to variation by the Examination Board where appropriate. 

Additional Costs (specified where applicable):

Last updated: 30 March 2023