REMF27-Real Estate Finance

Module Provider: Real Estate and Planning
Number of credits: 10 [5 ECTS credits]
Level:7
Terms in which taught: Spring term module
Pre-requisites:
Non-modular pre-requisites:
Co-requisites:
Modules excluded:
Current from: 2020/1

Module Convenor: Dr Gianluca Marcato

Email: g.marcato@henley.reading.ac.uk

Type of module:

Summary module description:

The module presents in depth concepts of real estate finance,Ìýboth theoretically and empirically. It can be seen as an advanced course in corporate finance (funding and valuation) applied to real estate topics.Ìý

Aims:

The module will enable students to interpret the main principles of corporate finance (cost of funding and valuation) with an appropriate emphasis on real estate. It will allow students to recognise the strategic importance of real estate to corporate financial decision-making processes.?Finally,Ìýanalytical and financial modelling skills will be improved.Ìý

Assessable learning outcomes:

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

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  understand how financial issues influence decisions involving real estate within firms;Ìý

  
  

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  analyse the capital structure of a real estate firm and its weighted average cost of capital;Ìý

  
  


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  examine the main sources of funding and their pricing;Ìý

  
  
  
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  critically discuss the choices of target return required for real estate investments;Ìý

  
  


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  apply and evaluate different appraisal methods used for real estate assets;Ìý

  
  


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  analyseÌýthe contribution of both real and financial options to the pricing of securities/assets and their use within decision-making processes.Ìý

  
  

Additional outcomes:

The module aims to encourage the development of analytical and quantitative skills in relation to the application of finance principles to real estate. Students will also improve their ability to translate theoretical concepts into practical solutions.Ìý

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Outline content:

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  Reporting of real estate companies in financial accounts;Ìý

  
  


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  Principles underlying decisions about capital structure, debt and equity financing;Ìý

  
  

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  Comparison of valuation methods used in finance and real estate;Ìý

  
  


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  Application of real option analysis to real estate finance decisions;Ìý

  
  

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Analysis of lease or buy decisions for both financial and accounting aspects.Ìý

Brief description of teaching and learning methods:

Contact hours:

Ìý	Autumn	Spring	Summer
Lectures		10
Tutorials		5
Guided independent study:	Ìý	Ìý	Ìý
Ìý Ìý Wider reading (independent)		10	20
Ìý Ìý Exam revision/preparation			40
Ìý Ìý Preparation for tutorials		10
Ìý Ìý Group study tasks		5
Ìý	Ìý	Ìý	Ìý
Total hours by term	0	40	60
Ìý	Ìý	Ìý	Ìý
Total hours for module	100

Summative Assessment Methods:

Method	Percentage
Written exam	100

Summative assessment- Examinations:

The module will be assessed through a two-hour formal examination.Ìý

Summative assessment- Coursework and in-class tests:

Formative assessment methods:

Students will receive feedback on the work they produce on a weekly basis. This will be done through practical sessions (workshops) where they can compare their work with a proposed solution and ask questions to develop their knowledge further. In some workshops they may also be asked to present their work to facilitate the discussion.Ìý

Penalties for late submission:

Penalties for late submission on this module are in accordance with the University policy. Please refer to page 5 of the Postgraduate Guide to Assessment for further information: http://www.reading.ac.uk/internal/exams/student/exa-guidePG.aspx

Assessment requirements for a pass:
The pass-mark for this module is 50%.

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.Ìý

Additional Costs (specified where applicable):

Last updated: 11 November 2020