Course detail

Investing and Finance in Real Estate

ÚSI-ERIFNAcad. year: 2020/2021

Investments and their attributes, cash flow, present and future value, methods for evaluation of investment efficiency, estimations of CF development and risk, portfolio and its principles, typical CF development for real estate, Life Cycle Cost LCC, Investment Valuation .

Learning outcomes of the course unit

Knowledge of typical cash flow of real estate, specifics of real estate, ability to work with the main determinants of investment and evaluate investment efficiency, fundamentals of real estate portfolios.

Prerequisites

Mathematics

Co-requisites

Not applicable.

Recommended optional programme components

Not applicable.

Recommended or required reading

BAUM, A. E., CROSBY, N. Property investment appraisal. London: Wiley-Blackwell, 2007. ISBN 978-14-05135-55-9.
BRUEGGEMAN, W. B., FISHER, J. D. Real Estate Finance & Investments. New York: McGraw-Hill Education, 2015. ISBN 978-0073377353.
FOTR, J., SOUČEK, I. Investiční rozhodování a řízení projektů. Praha: GRADA, 2011. ISBN 978-80-247-3293-0.
STAIGER, R. Foundations of real estate financial modelling. New York: Routledge, 2015. ISBN 978-1-138-02516-5.
SCHNEIDEROVÁ HERALOVÁ, R. Udržitelné pořizování staveb (ekonomické aspekty). Praha: Wolters Kluwer, 2011. ISBN 978-80-7357-642-4.
VALACH, J. a kol. Investiční rozhodování a dlouhodobé financování. Praha: EKOPRESS, 2010. ISBN 978-80-86929-71-2.

Planned learning activities and teaching methods

Teaching takes the form of lectures and seminars. Lectures have the character of explanation of basic principles, methodology of given issues, problems and their exemplary solutions. The exercise supports especially the practical mastery of the subject matter presented in lectures or assigned tasks for independent study with the active participation of students.

Assesment methods and criteria linked to learning outcomes

Conditions of course-unit credit: participation in seminars, compliance of set tasks.
Exam will comprise written and oral part and will be classified according to performance level in both parts.

Language of instruction

Czech

Work placements

Not applicable.

Course curriculum

1. Planning of investment activity - importance of investment activity, stages of preparation.
2. Present value of investment, discounting, special cases.
3. Methods for evaluation of economic efficiency of investment projects (NPV, PI).
4. Methods for evaluation of economic efficiency of investment projects (IRR, PB).
5. Fundamentals of portfolio theory: return and risk.
6. Fundamentals of portfolio theory: effective set and optimal portfolio.
7. Cash flow plan of real estate investment project and its specifics.
8. Typical development of cash flow in real estate, financial modeling.
9. Risks in real estate and returns under risk, trend analysis.
10. Valuation of real estate for investment purposes, Investment Value.
11. Life Cycle Cost - LCC.
12. The evaluation of economic efficiency of investment projects
13. Case Study: LCC - reconstruction of a building.

Aims

Basic understanding of investing in real estates and the ability of unassisted evaluation of investment efficiency.

Specification of controlled education, way of implementation and compensation for absences

Attendance is checked in attendance sheet.

Classification of course in study plans

  • Programme REI_P Master's, 1. year of study, summer semester, 4 credits, compulsory

Type of course unit

 

Lecture

26 hours, optionally

Teacher / Lecturer

Exercise

13 hours, compulsory

Teacher / Lecturer

eLearning