RE3DAF-Development Appraisal and Finance

Module Provider: Real Estate and Planning
Number of credits: 20 [10 ECTS credits]
Level:6
Terms in which taught: Autumn / Spring term module
Pre-requisites: RE2VAL Property Valuation and RE1IAP Investment Appraisal
Non-modular pre-requisites:
Co-requisites:
Modules excluded:
Current from: 2019/0

Module Convenor: Prof Pat McAllister

Email: p.m.mcallister@henley.reading.ac.uk

Type of module:

Summary module description:

The module covers the approaches used to evaluate and appraise the financial viability of real estate development projects. Specifically, this module will provide knowledge and understanding of a range of financial appraisal techniques and their application to real estate development opportunities. An understanding of the way in which land value is assessed and the distribution of returns from real estate development underpins the content of this module. It then builds on this understanding in order to investigate the way in which risks and rewards associated with real estate development activity might be shared. ÌýThe module examines a range of debt and equity investments in real estate development projects.

Aims:

The module examines the methods used to appraise the financial viability of development projects. Specifically, this module will critically examine the inherent value systems of various development viability appraisal techniques in an economic, social and environmental context. An understanding of the way in which land value is created and distributed underpins the content of this module. It then builds on this understanding in order to investigate the way in which financial risk and reward associated with development activity might be shared.

Assessable learning outcomes:

By the end of the module it is expected that the student will be able to:

Ìý

• apply different development appraisal techniques;


• incorporate equity and debt funding in real estate development appraisals;


• analyse the nature and distribution of development risk;


• appreciate the problems of risk identification, measurement, management and control in real estate development projects.

Additional outcomes:

Outline content:

• Recap and critique of simple residual valuation


• Cash-flow residual valuation


• Modelling debt and equityÌý


• Risk analysis and management


• Development viability appraisal in the planning system


• Sources of development finance

Brief description of teaching and learning methods:

Lectures supported by workshops.

Contact hours:

Ìý	Autumn	Spring	Summer
Lectures	9	9
Practicals classes and workshops	9	9
Guided independent study:	Ìý	Ìý	Ìý
Ìý Ìý Wider reading (directed)	5	6
Ìý Ìý Advance preparation for classes	5	6
Ìý Ìý Essay preparation	72	70
Ìý	Ìý	Ìý	Ìý
Total hours by term	100	100	0
Ìý	Ìý	Ìý	Ìý
Total hours for module	200

Summative Assessment Methods:

Method	Percentage
Written assignment including essay	100

Summative assessment- Examinations:

None

Summative assessment- Coursework and in-class tests:

Simulated professional reports with hand-ins in final week of autumn term and spring term, equivalent to two 2,500 word submissions.

Formative assessment methods:

No formative assessmentÌý

Penalties for late submission:
The Module Convener 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[1] (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:
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:

A mark of at least 40% overall.

Reassessment arrangements:

AÌý5000 wordÌýreport or equivalent on a project-based assignment.Ìý

Additional Costs (specified where applicable):

Last updated: 2 September 2019