The fully revised and updated version of the leading textbook on real estate investment, emphasising real estate cycles and the availability and flow of global capital

Real Estate Investment remains the most influential textbook on the subject, used in top-tier colleges and universities worldwide. Its unique, practical perspective on international real estate investment focusses on real-world techniques which measure, benchmark, forecast and manage property investments as an asset class. The text examines global property markets and real estate cycles, outlines market fundamentals and explains asset pricing and portfolio theory in the context of real estate.

In the years since the text's first publication, conditions in global real estate markets have changed considerably following the financial crisis of 2008-2009. Real estate asset prices have increased past pre-crisis levels, signalling a general market recovery. Previously scarce debt and equity capital is now abundant, while many institutions once averse to acquiring property are re-entering the markets. The latest edition - extensively revised and updated to address current market trends and practices as well as reflect feedback from instructors and students - features new content on real estate development, improved practical examples, expanded case studies and more. This seminal textbook:

* Emphasises practical solutions to real investing problems rather than complex theory

* Offers substantial new and revised content throughout the text

* Covers topics such as valuation, leasing, mortgages, real estate funds, underwriting and private and public equity real estate

* Features up-to-date sections on performance measurement, real estate debt markets and building and managing real estate portfolios

* Includes access to a re-designed companion website containing numerous problems and solutions, presentation slides and additional instructor and student resources

Written by internationally-recognised experts in capital management and institutional property investing strategies, Real Estate Investment, Second Edition: Strategies, Structures, Decisions is an indispensable textbook for instructors and students of real estate fund management, investment management and investment banking, as well as a valuable reference text for analysts, researchers, investment managers, investment bankers and asset managers.

DAVID HARTZELL is Steven D. Bell and Leonard W. Wood Distinguished Professor of Finance and Real Estate and Director, Wood Center for Real Estate Studies, University of North Carolina. He is a Fellow of the Private Equity Research Consortium, Kenan Institute and serves on the Board of Directors of Highwoods Properties, a publicly traded Real Estate Investment Trust (REIT), and has served on the Investment Advisory Committee of the $100 billion North Carolina Retirement System.

ANDREW BAUM is Professor of Practice, Saïd Business School, University of Oxford and Professor Emeritus, University of Reading. He is Director of the Oxford Future of Real Estate Initiative, Chairman of Newcore Capital Management, and has held senior executive and non-executive positions with Grosvenor, The Crown Estate, CBRE Global Investors and others.

Klappentext

LEARN THE FUNDAMENTALS OF INTERNATIONAL REAL ESTATE INVESTING WITH THIS NEWLY UPDATED AND INDUSTRY-LEADING TEXTBOOK

Real Estate Investment and Finance offers unique real-world perspectives on international real estate investment whilst providing practical techniques for measuring, benchmarking, forecasting and managing property investments as an asset class. Already essential reading in top-tier colleges and universities worldwide, this fully-revised new edition remains the most influential textbook on institutional investment in real estate. Andrew Baum and David Hartzell draw from their years of experience in capital management and institutional property investing to present a thorough and up-to-date resource that delivers real solutions to real investment problems.

In-depth yet accessible chapters provide clear and accurate explanations of portfolio theory as applied to real estate, including practical guidance on valuation, mortgages, underwriting, leasing, private and public equity, real estate development, investment funds and debt markets. Whether a student, instructor or practitioner, you will gain a deeper understanding of global property markets, real estate cycles, asset pricing, the availability and flow of global capital and much more.

Real Estate Investment and Finance is an indispensable resource for instructors and students of real estate finance and investments, fund management, investment management and investment banking, as well as a valuable reference for analysts, researchers, real estate and finance professionals, and global real estate investors of all types looking to make more informed decisions.

Inhalt

Acknowledgements xxi

About the Authors xxiii

Preface xxv

Part One Real Estate as an Investment: An Introduction

Chapter 1 Real Estate The Global Asset 3

1.1 The Global Property Investment Universe 3

1.2 Market Players 6

1.2.1 Investors 6

1.2.2 Fund Managers 9

1.2.3 Advisors 9

1.3 Property Its Character as an Asset Class 11

1.3.1 Property Depreciates 12

1.3.2 Lease Contracts Control Cash Flows 13

1.3.3 The Supply Side is Inelastic 13

1.3.4 Valuations Influence Performance 14

1.3.5 Property is Not Liquid 15

1.3.6 Large Lot Sizes Produce Specific Risk 16

1.3.7 Leverage is Commonly Used in Real Estate Investment 18

1.3.8 Property Appears to be an Inflation Hedge 19

1.3.9 Property is a Medium-Risk Asset 21

1.3.10 Real Estate Cycles Control Returns 22

1.3.11 Property Appears to be a Diversifying Asset 24

Specific Risk 27

Leverage 27

Illiquidity 28

Taxes, Currency, and Fees 28

1.4 Conclusion 28

Chapter 2 Global Property Markets and Real Estate Cycles, 19502020 33

2.1 Introduction and Background 33

2.1.1 The Property Cycle 33

2.2 A Performance History 34

2.2.1 Before 1970: Real Estate Becomes a Medium-Return Asset 34

2.2.2 The 1970s: Inflation, Boom, and Bust 36

The USA 36

The UK 37

2.2.3 The 1980s: New Investors Flood the Real Estate Capital Market 38

The USA 38

The UK 42

2.2.4 The 1990s: The Rise of REITs 43

The USA 43

The UK: Deep Recession, Low Inflation, and Globalization 45

2.2.5 20027: A Rising Tide Lifts All Boats 47

The USA 47

The UK 59

2.2.6 The Global Real Estate Credit Crisis Hits 60

The USA 60

The UK 67

2.2.7 The Markets Recover Post-crisis 70

2.3 The Global Market 72

2.3.1 The European Market Develops 72

2.3.2 Asia Emerges 75

2.4 Real Estate Cycles: Conclusion 80

Lesson 1: Too Much Lending to Property is Dangerous 80

Lesson 2: Yields are Mean-Reverting Unless Real Risk-Free Rates Change 81

Lesson 3: Look at Yields on Index-Linked 81

Chapter 3 Market Fundamentals and Rent 83

3.1 Introduction: The Global Property Cycle and Rent 83

3.2 The Economics of Rent 84

3.2.1 Rent and Operational Profits 84

3.2.2 Theories of Rent 86

Ricardo 86

von Thünen 87

Fisher 89

3.2.3 Rent as the Price of Space 90

3.2.4 Supply 91

3.2.5 Demand 93

The Cyclical Demand for Space 93

The Structural Demand for Space 94

Variations in Locational Demand by Use 95

3.2.6 The Relationship Between Rental Value and Rental Income 97

3.2.7 The Impact of Cu…