Real Estate Finance for Construction Management
CIEN 4138 Section 001
Spring 2023
Room Mudd 633
Monday 4:10 to 6:40pm
Kevin Riordan
kjr2154@columbia.edu
Cell: 917-975-2211
Office Hours:
Monday 2:00 to 3:30pm
COURSE DESCRIPTION
The financing of commercial real estate transactions consists of two components-debt and
equity. The larger component of the two is debt. As indicated in the University’s course
description, CIEN 4138 is an “Introduction to financial mechanics of public and private
real estate development”. The central objective of this course is to familiarize students with
the different forms of debt in the public and private markets to finance commercial real
estate properties. The course is a combination of lecture and in-class work. There is one
Exam and there are case studies to be completed at home and handed in. I do maintain the
right to change the schedule and materials to better fit the class as the semester progresses.
The course consists of three sections.
 Part I focuses on time value of money, mortgage math and the underwriting of cash
flows for various property types.
 Part II is an introduction to private debt structures including development financing.
 Part III will examine the various capital structures, public and private, employed to
own and finance commercial real estate.
LEARNING GOALS AND OBJECTIVES
In this course, students will:
 Obtain a knowledge of the strategies and methods to finance commercial real estate
projects
 Develop a competency with time value of money concepts and calculations
 Acquire a working knowledge of commercial property terms and concepts to
construct cash flows generated by various property types
 Learn about the debt instruments available in the market and how lenders mitigate
the risks through loan underwriting and documentation.
 Become familiar with how complicated financing structures such as mezzanine debt
and preferred equity are utilized in the market.
 Learn how public market debt (CMBS) is structured and priced in the capital markets.
PREREQUISITES
(IEOR E2261) and (CIEN E3129) or instructor's permission
A knowledge of time value of money is good but we will review all concepts during the
first and second classes. The basic knowledge of time value of money calculations include
five elements-Present Value (PV), Future Value (FV), Interest Rate (I/Y), number of
periods (N) and Payment (PMT). You must have access to Excel. We will review Excel
applications and formulas but a working knowledge is also beneficial. You will be permitted to use Excel and/or a calculator for quizzes and exams. I use the Texas Instrument’s
BAII Plus. Another good, and relatively inexpensive financial calculator is the HP 10bII.
Finally, you can download a financial calculator app on your phone but phones are NOT
permitted during exams.
COURSE MATERIALS
A textbook is not required for this course. The PowerPoint slides which include numerous
examples and problems coupled with the posted readings and assignments will provide the
student with sufficient knowledge to meet and exceed all of the course Goals and
Objectives.
In addition to this syllabus, a detailed week by week class outline has been posted in canvas
under the first Module-Class Information. The outline lists the materials covered,
assignments and readings. All materials are posted to Canvas
Check Canvas and your official Columbia email account regularly.
ASSESSMENTS, TIMING AND WEIGHTINGS
Below is a table that outlines course assessments. NOTE: subject to change depending
upon the materials covered in class.
1
2
3
4
5
6
7
ASSESSMENTS
DATE
DATE
TOPIC
AVAILABLE
DUE
WEIGHTING
TVM EXERCISES
January 23, 2023 January 30, 2023
5%
WAREHOUSE CASH FLOW
February 13, 2023 February 20, 2023
10%
FINANCIAL FEASIBILITY
February 27, 2023
March 5, 2023
10%
EXAM I
March 6, 2023
March 6, 2023
20%
CONSTRUCTION PROJECT CASH FLOW
March 20, 2023
March 27, 2023
15%
PREFERRED EQUITY
April 3, 2023
April 10, 2023
20%
CMBS GALLERIA MALL
April 17, 2023
May 1, 2023
20%
100%
GRADING POLICY
I adhere to the grading policy promulgated on the School’s website.
https://bulletin.engineering.columbia.edu/degree-requirements-and-satisfactory-progress
The numerical ranges and the resultant letter grade are posted in the Grading Policy
document also located in the first Module Course Information
INSTRUCTION DELIVERY-HYBRID or HYFlex
I will follow University guidelines as to how the course is delivered to students. While I
encourage as many of you to attend in person as I believe that is most rewarding experience,
there are physical limitations. I recommend that you contact the department to determine
physical class availability.
CLASSROOM CONDUCT
1. I am pretty punctual. I will always try to start the class on time and adhere to allotted
time frame.
2. If you have questions from the previous lecture, send me an email prior to class and
I am happy to review the topic before proceeding to new material.
3. We have objectives to cover each class. Please do try to stay for the entire class.
4. If we are in a physical setting for class, I do request that you please refrain
from using cellphones unless you have downloaded a financial calculator app
and you are solving a problem
I know this is an elective course for all of you. My goal, in addition to covering the
learning Goals and Objectives above, is to provide insight and share my experiences
in this field where I enjoyed working for over 30 years.
Please prepare properly for each class session. Complete all background reading and
assignments. You cannot learn if you are not prepared. Participation is highly
welcomed (and rewarded!). Stay focused and involved. You will get so much more out
the course.