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Real Estate Capital Markets
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Table of Contents

• Topic Page
• I. Securitization of Real Estate Debt
• Types of Mortgages and Mortgage
  Mathematics.
• Overview of Securitization
• Why Create Derivatives
• Clientele Effects
• Principle of Value Additivity .
• Ackerlofs Market for Lemons .
• Options and Embedded Options in Mortgages.
• Valuation of Mortgage Options .
• Modeling Prepayment ..
• Mortgage Pass-Throughs (MPTs) ..
• Collateralized Mortgage Obligations (CMOs)
  .

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Table of Contents

• Topic Page
• Mortgage Pricing Models..
• Alternative Measures of Duration
• Option Adjusted Spreads (OAS) .
• Alternative Measures of Convexity ...
• Other Types of CMOs
• Planned Amortization Classes (PACs)
• Target Amortization Classes (PACs)
• Floater and Inverse Floater .
• Private Label CMOs
• Credit Enhancement Techniques .
• Senior-Subordinate Structure

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Table of Contents

• Topic Page
• Private Label CMOs (continued)
• Senior-Subordinate Structure (continued)..
  ..
• Shifting (Ownership) Interest Structure
  
• Allocating Losses Waterfall and Direct
  Writeoff Methods..
• Mortgage Defaults
• Credit Scores
• Agency Ratings .
• Loss Severity and Credit Enhancement..
• Commercial Mortgage-Backed Securities (CMBS)
  
• Introduction to Commercial Mortgages .
• Characteristics of CMBS Securities ..
• Credit Risk and Underwriting Ratios/Criteria
  
• Structuring the Credit Support .
• Lessening Credit Risk ..

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Table of Contents

• Topic Page
• Commercial Mortgage-Backed Securities (continued)
  
• Lessening Credit Risk ..
• Role of the Servicer ..
• Event Risk ..
• CMBS Pricing and Relative Valuation ..
• Considerations in Pricing CMBS Securities
  ..
• CMBS Spreads ..
• Appropriate Benchmark for CMBS Spreads .
• CMBS Valuation Models ..

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Table of Contents

• Topic Page
• II. Securitization of Real Estate Equity
• Overview of Real Estate Equity Securitization
  .
• Real Estate Investment Trusts (REITS) .
• Characteristics of REITs ..
• REIT Structures .....
• REIT Accounting
• The Games that REITs Play
• Appropriate Measures of Performance .
• Sarbanes-Oxley Act .
• How REITs Grow ..

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Table of Contents

• Topic Page
• Real Estate Investment Trusts (REITS) .
• REIT Capital Market Issues.
• Specialty Real Estate Finance Companies.
• Captive Financing Affiliates ..
• Equity Offerings and IPOs
• Rating Agencies ..
• REIT Mergers ...
• REIT Valuation ..

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Table of Contents

• Topic Page
• Commingled Real Estate Funds
• Characteristics of CREFs .
• NCREIF Calculation of CREF Returns .
• Smoothing Bias and Correction for Bias
  ..
• PRISA Case Study
• Relationship Between CREFs and REITs
• CREFs as an Inflation Hedge
• Secondary Market for CREFs
• Real Estate Swaps

9
Table of Contents

• Topic Page
• Real Estate Limited Partnerships
  (RELPs).
• Types of Offerings .. Regulat
  ion of Syndicates .
• Cash Flow Mathematics of RELPs ..
• Tools Used in Analyzing Partnerships.
  Quantitative Tools Qualita
  tive Tools .
• Secondary Market for RELPs ..
• Partnership Roll-Ups .. Maste
  r Limited Partnerships
• Grading Roll-Ups

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Table of Contents

• Topic Page
• Real Estate in a Mixed Asset Portfolio
  
• Dart Throwing Approach to Real Estate
• Diversification by Property Type
• Intra and Inter-City Diversification
  
• Qualitative Diversification Strategies
  
• Nine Nations of North America .
• Economic Performance Zones (EPZ)
• Dominant Employment Categories (DEC)
• Edge Cities ...
• International Real Estate Securities
  
• Real Estate and the Asian Crisis