Re Finance
RE Finance
Bring to class.
Due on 3/19.
PART 1
Mac Development Corporation Problem Set
It will help the discussion if you bring an extra copy of your answers to class & the case for reference
Download case (approx. $4 charge)
Mac Development Corporation Case Study Reference https://cb.hbsp.harvard.edu/cbmp/access/17117433 Four Major Areas 1. ID Risks a. “Imagine that you are a real estate developer who saw the 41-acre site the week before Dick McCaffrey did in August , 1999. Why would you decide not to pursue the purchase of the property? b. Major Factors & Risks & Probability of success c. What is the probability of success for the Phoenix Project? i. Probability for each part ii. Joint probability 2. Risk Management a. What is your assessment of how well McCaffrey managed the risks? b. What is the most important thing McCaffrey did to manage the risks? c. How much uncertainty is reduced by each of these actions? d. Why did McCaffrey attack the five primary risks in the order he did? i. Criticisms? 3. Economics of the Phoenix Project (Potential payoffs) a. Do the returns justify the all the risks McCaffrey has taken? 4. Action Issues a. Outcome of Village Meeting? b. Outcome of Abatement (TIF and assessment)? c. Agreement on final purchase price? d. Getting the loan?
PART 2
Read the Cycle Pro LLC lease in the Litewood building posted on D2L.
Fill out the following information as best you can. Indicate any caveats, inconsistencies, or things that are not clear in the lease. 1. Square Feet leased? The Lessor leases to Lessee approximately 5,308 rentable square feet of space on the south side of the first floor of the property located at 3575. 2. Rent and options and their respective rent? (please quote rents in $ psf per year) Lease year foot
Bring to class.
Due on 3/19.
PART 1
Mac Development Corporation Problem Set
It will help the discussion if you bring an extra copy of your answers to class & the case for reference
Download case (approx. $4 charge)
Mac Development Corporation Case Study Reference https://cb.hbsp.harvard.edu/cbmp/access/17117433 Four Major Areas 1. ID Risks a. “Imagine that you are a real estate developer who saw the 41-acre site the week before Dick McCaffrey did in August , 1999. Why would you decide not to pursue the purchase of the property? b. Major Factors & Risks & Probability of success c. What is the probability of success for the Phoenix Project? i. Probability for each part ii. Joint probability 2. Risk Management a. What is your assessment of how well McCaffrey managed the risks? b. What is the most important thing McCaffrey did to manage the risks? c. How much uncertainty is reduced by each of these actions? d. Why did McCaffrey attack the five primary risks in the order he did? i. Criticisms? 3. Economics of the Phoenix Project (Potential payoffs) a. Do the returns justify the all the risks McCaffrey has taken? 4. Action Issues a. Outcome of Village Meeting? b. Outcome of Abatement (TIF and assessment)? c. Agreement on final purchase price? d. Getting the loan?
PART 2
Read the Cycle Pro LLC lease in the Litewood building posted on D2L.
Fill out the following information as best you can. Indicate any caveats, inconsistencies, or things that are not clear in the lease. 1. Square Feet leased? The Lessor leases to Lessee approximately 5,308 rentable square feet of space on the south side of the first floor of the property located at 3575. 2. Rent and options and their respective rent? (please quote rents in $ psf per year) Lease year foot