## RE1IAP-Investment Appraisal

Module Provider: Real Estate and Planning
Number of credits: 20 [10 ECTS credits]
Level:4
Terms in which taught: Autumn / Spring / Summer module
Pre-requisites:
Non-modular pre-requisites:
Co-requisites: RE1PREP Projects in Real Estate and Planning (1)
Modules excluded:
Module version for: 2016/7

Module Convenor: Mr Gianluca Marcato

Summary module description:
This module introduces students to basic financial mathematics and their application to equity, bond, loan and real estate pricing. Following some introductory material on the nature of commercial property as an asset class, there is emphasis on the application of financial mathematics to the appraisal of a range of real estate assets such as commercial assets, land and going concerns on different bases.

This module is delivered at University of Reading and University of Reading Malaysia.

Aims:
The module aims to introduce the student to the mathematics, techniques and methodologies underpinning investment appraisal and valuation of commercial property assets and to introduce the characteristics of commercial property as an investment class.

Assessable learning outcomes:
By the end of the module it is expected that the student will be able to:

• Solve practical problems using discounting and compounding related to the valuation of income flows.
• Apply financial mathematics to the valuation of properties,equities, bonds and loans.
• Discuss and describe the investment characteristics of commercial property as an asset class relative to other major investment opportunities.
• Recognise and outline the different methods of property valuation.

The module also aims to encourage the development of oral communication, problem solving, business awareness, spreadsheet and numeracy skills particularly in the practical and workshop sessions. These represent key, transferable business skills.

Outline content:
The module has two parts. Part 1 (Autumn Term) covers basic investment mathematics, methods of investment appraisal and the valuation of investment assets.
Part 2 (Spring Term) applies the methods taught in Part 1 to property specific examples and develops the skills related to property market analysis. It discusses pricing models, calculation of investment value and introduces the main methods of property investment analysis and valuation.

Brief description of teaching and learning methods:
Each term consists of 10 lectures and supporting tutorials at the times specified on the term timetable. The associated tutorials are designed to test student understanding of concepts and to demonstrate how the various techniques are applied. Students are expected to complete all work set and they will be called upon to answer questions in tutorial meetings.

Contact hours:
 Autumn Spring Summer Lectures 20 20 2 Seminars 4 4 0 Guided independent study 50 50 50 Total hours by term 74.00 74.00 52.00 Total hours for module 200.00

Summative Assessment Methods:
 Method Percentage Written exam 45 Class test administered by School 55

Other information on summative assessment:

Formative assessment methods:
Consists of a series of seminar exercises where students attempt to solve appropriate problems.

Penalties for late submission:

The Module Convener will apply the following penalties for work submitted late, in accordance with the University policy.
• where the piece of work is submitted after the original deadline (or any formally agreed extension to the deadline): 10% of the total marks available for the piece of work will be deducted from the mark for each working day (or part thereof) following the deadline up to a total of five working days;
• where the piece of work is submitted more than five working days after the original deadline (or any formally agreed extension to the deadline): a mark of zero will be recorded.

The University policy statement on penalties for late submission can be found at: http://www.reading.ac.uk/web/FILES/qualitysupport/penaltiesforlatesubmission.pdf
You are strongly advised to ensure that coursework is submitted by the relevant deadline. You should note that it is advisable to submit work in an unfinished state rather than to fail to submit any work.

The Module Convenor will apply the following penalties for work submitted late, in accordance with the University policy.
• where the piece of work is submitted up to one calendar week after the original deadline (or any formally agreed extension to the deadline): 10% of the total marks available for the piece of work will be deducted from the mark for each working day (or part thereof) following the deadline up to a total of five working days;
• where the piece of work is submitted more than five working days after the original deadline (or any formally agreed extension to the deadline): a mark of zero will be recorded.

• The University policy statement on penalties for late submission can be found at: http://www.reading.ac.uk/web/FILES/qualitysupport/penaltiesforlatesubmission.pdf
You are strongly advised to ensure that coursework is submitted by the relevant deadline. You should note that it is advisable to submit work in an unfinished state rather than to fail to submit any work.

Length of examination:
One 90 minutes examination.

Requirements for a pass:
A mark of at least 40%.

Reassessment arrangements:
Re-examination by a 3 hour paper in August/September (100%).