The course textbooks are listed below. Many of the course readings can be found on the course Web site.
[Geltner] = Geltner, David M., Norman G. Miller, Jim Clayton, and Piet Eichholtz. Commercial Real Estate Analysis and Investments. 2nd ed. Mason, OH: South-Western Educational Publishing, 2007. ISBN: 9780324305487.
[de Neufville] = de Neufville, Richard, and Stefan Scholtes. Flexibility in Design. Cambridge, MA: MIT Press, 2011.
|L1||Introduction: course organization and learning objectives, uncertainty exercise, Garage case concepts||
Zhang, Na. “Difficulty in Identifying Trend and Volatility of Price Indices: Examples from International Real Estate Market.” MIT, 2010.
de Neufville, chapter 1
———, “Thesis Manual.”
|L2||Discounting: standard and certainty-equivalence||Geltner, chapter 10 (including appendix C)|
|L3||Economic model of options applied to real estate||Geltner, chapter 27|
|L4||Economic model of options (cont.): underlying asset dynamics and GIGO issues||Geltner, chapters 27 and 29 (appendix)|
Design structure matrix (DSM)
Identification of points of flexibility
|Bulloch, Benjamin, and John Sullivan. “Application of the Design Structure Matrix (DSM) to the Real Estate Development Process.” Master’s thesis, MIT, 2009.|
Discussion of development process
|Bartolomei, Jason E. “Qualitative Knowledge Construction for Engineering Systems: Extending the Design Structure Matrix Methodology in Scope and Procedure.” PhD dissertation, MIT, 2007.|
|L7||Garage case: detailed analysis and exposition of “engineering analysis approach”|
Satellite fleet case
de Neufville, chapter 6
Ohama, Dai. “Flexible Design of Airport System Using Real Options Analysis: Case Study of New Runway Extension Project of Tokyo international Airport.” 1.231 project, MIT, 2007.
Discussion of Monte Carlo analyses
Workshop on finalizing your reports
|L10||Flexibility in real estate development – case examples of vertical and horizontal expansion||de Neufville, appendix|
|L11||Scheduled reviews with teams: what does your model teach us?|