How do investors measure performance and decide
“what is a good deal”?
Let's cut to the chase:
I am a university professor and also work for private equity commercial real estate investment and development companies.
I enjoy teaching others about what I do for a living.
You found this page as you were looking for information about investing in commercial real estate.
I want to help you learn as much about commercial real estate as possible so you can pass your next text, win your next client or close your next deal.
Yes, I am selling something. But, not right now because honestly, why would you? You don't know me.
To the right is an intro video about me and what I teach. Below is a description of what I'm working on.
Between the two, I hope I can start to help you get to where you want to go.
I'm Creating A Course For You:
Investors and developers are constantly evaluating opportunities, trying to decide what is a good deal and what isn’t. Since everyone has different objectives and strategies, understanding what the main return metrics are (Cap Rate, Cash on Cash, IRR, etc.) and how to apply them is critical to one’s success.
In this 7-part, self-paced, video series, we will:
cover each main return metric used in commercial real estate analysis
define them as you may have learned them in school and then define them in layman’s terms
explore how to calculate each, along with how to avoid common mistakes
review how they’re applied, the strengths and weaknesses of each and which are more popular in different situations
You will learn what the main investment return metrics
are in commercial real estate,
how to calculate them, long-hand and in Excel,
and how to apply them.
You’ll learn about three main kinds of return metrics:
Snapshots: those measures that only look at performance at a given point in time and only from operating income or cash flows
Total return, non-compounding: those measures that look at total, overall investment performance without accounting for the timing and magnitude of a major capital event like resale or refinance
Total return, compounding: those measures that account for the time value of money
Who Is This Course For:
This course if for beginners in commercial real estate.
You don’t need any prior knowledge about real estate or finance principles like time value of money or investment analysis concepts or how to use Excel.
What Will We Cover:
1.1) What is a Cap Rate?
1.2) What is a Good Cap Rate?
1.3) What are the Different Kinds of Cap Rates?
1.4) Why Cap Rate uses Following-year NOI?
Cash on Cash Return
2.1) What is Cash on Cash Return?
2.2) What is the Difference Between Cash on Cash Return and Cap Rate?
3.1) What is Equity Multiple?
Compound Annual Growth Rate
4.1) What is CAGR?
4.2) How is CAGR Applied in Real Estate?
Internal Rate of Return
5.1) What is IRR?
5.2) What is the Difference Between IRR vs Cap Rate?
5.3) What is the Difference Between IRR vs Discount Rate?
6.1) What is a Discount Rate in Real Estate (versus Corporate Finance)?
6.2) How do I Choose or Estimate my Discount Rate?
Net Present Value
7.1) What is Net Present Value?
7.2) How is NPV Different than PV?
7.3) How is NPV Applied in Real Estate?
We're in the middle of building the course so, if this sounds like something you could benefit from, let us know by registering.
No obligation, no credit card or payment required.
We'll send you some information about the course.
You can ask questions, we can learn more about what you're looking for and we can take it from there.
If you've gotten this far down the page, I appreciate you taking the time. I look forward to finding a way to help.