class 11: Corporate and International Real Estate Flashcards
Real estate, including leases, can be a major asset and contributor to the success of a company
true or false
true
Considerations for corporate real estate include:
Zoning
Visibility and customer access
Access to factors of production
Energy, water, waste disposal
Telecommunication and internet bandwidth
Corporate image
Location of property must be aligned with what?
with intended use of building
Quality of property must be aligned to what?
to the image the company wishes to project
factors of production
Labour pool/skilled labour
Proximity to raw materials and the cost of transporting these materials
Transportation
Corporate image
Targeted clients/customers
Interior and exterior design
Sustainability
LEED (Leadership in Energy and Environmental Design)
Based on conservation of energy, water, reduction of waste, etc
Considerations to include when we choose ether to own or lease?
Flexibility vs certainty
Availability of capital
Alternate use of capital
Flexibility vs certainty when choosing to own or lease
Ability to adjust space (size, location, etc.) through leasing vs certainty of availability through ownership
Ability to modify and adjust the space to meet the needs of the company
Alternate use of capital when choosing to own or lease
Can redeployment of the capital generate a higher return for the company?
Redeployment of capital can be achieved through:
Sale Leaseback strategy
Financing
Spinoff
Spinoff
Creation of a REIT
Rewards of investing in international real estate can include:
Exposure to higher growth markets
First mover advantage
Market diversification of risk
examples of first mover advantage in RE
First to bring new property types to market
New construction methodologies
New ownership or financing structures
Risks of investing in international real estate can include:
Geopolitical risks
Culture and customs
Asset risk
Legal risks
Financial risks
