Commercial Investment Real Estate

NOV-DEC 2017

Commercial Investment Real Estate is the magazine of the CCIM Institute, the leading provider of commercial real estate education. CIRE covers market trends, current developments, and business strategies within the commercial real estate field.

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In the early 1990s, people started bringing their own computers to the classes. "Excel had a profound impact on our courses. Instead of memorizing keystrokes, you could use the Excel workbooks to analyze on the fly," says Joseph Larkin, CCIM, MCR, SIOR, a senior instructor and CEO of First Realty in Denver. "The CCIM Excel workbooks brought our curriculum to a very high level. The student now has the ability to change economic variables with ease and can evaluate the impact in seconds. In the past, it has taken hours to recalculate the impact of the change." An example at the forefront in today's economy pertains to what would happen to the analysis if tax rates were reduced. Now this can be completed with ease, according to Larkin. "That's an incredibly powerful tool for our students," he says. Transitioning the investment analysis materials to the computers "was a milestone," Spencer says. "Those changes enabled a wider, deeper level of analy- sis and understanding of the basic cash flow model. They also enabled us to provide additional applications for user analysis — cost of occupancy, lease analysis, lease versus own analysis, and sale leaseback analysis. They distanced CCIM education from most of the industry and enabled us to provide students with a very high competence level in decision making." The addition to the curriculum for the user side of the business was driven in large part by Victor Lyon, CCIM, 1972 Institute president, according to Lynn. "No one had viewed commercial real estate from the perspective of the user," she says. "Vic saw a huge market there and worked to develop what we called a user track. This was the first time we recognized the cost of occupancy as educational content. It was a shift from wearing the investor hat to putting on the user hat and considering their perspective — that of cost of occupancy as opposed to return on investment." This transition to include the user side, Spencer says, was important because there are many more transactions compared to investment brokerage. "That enabled CCIM, in part, to be recognized as the most respected designation in the industry, particularly on the brokerage side," he says. "CCIM took user occupancy analysis to a much more tech- nical and higher level." This was an area that universities weren't teach- ing at the time. "We have continued to make sure that we are the leader in user decision making," says Steve Cannariato, CCIM, MET, CDEI, a senior instructor and managing broker of Hawkins & Can- nariato in Boise, Idaho. "That's evidenced by those who attend, from tenant representatives to the Gen- eral Services Administration to corporate real estate departments. We do an excellent job of teaching comparative lease analysis, lease versus own analysis, and sale leaseback analysis, subleases, and buyouts." Advancing to Be Relevant Staying relevant and current in education is an ongoing challenge. In 2001, the Institute estab- lished a new committee to meet that challenge, the Body of Knowledge Committee. "The establishment of the BOK Committee was a strategic move by the Institute to ensure that its curriculum was comprehensive, robust, and current to things going on in the marketplace," Cannariato says. "BOK was charged with identifying core con- cepts, practitioner competencies, and relevant con- tent to make sure that we were at the cutting edge." Part of staying cutting-edge is to continuously evaluate the tools that practitioners are using or need to use. The Institute's market analysis course was updated during this time to incorporate many of those technologies. "Over the past 10 years, there has been an accel- eration of technology on many fronts," says Gary M. Ralston, CCIM, SIOR, CPM, a senior instructor and managing partner of Coldwell Banker Commercial Saunders Ralston Dantzler Realty in Lakeland, Fla. Geographic information system technology was emerging as a practical way to understand the mar- ket demand associated with specific properties and geographies. "CCIM education included the analy- sis of geographies associated with properties with a view to articulating demand," Ralston adds. "The gap analysis model — demand less supply equals gap — was demonstrated as a practical application with a view to understanding how to maximize the value of properties." While Site To Do Business was developed in 2000, CCIM began incorporating STDB as online tools for financial, market, spatial, and competitive analysis in 2006. This was rapidly integrated into CI 102, the market analysis course. "STDB has had a huge impact on the industry, using demographic and psychographic data to make a real estate decision," Larkin says. "Normally, a devel- oper would complete market analysis to determine if there is a gap in the market for a project first, and that's where STDB comes into play. Very few coun- tries in the world have access to the granular level of demographic data and market information as we do in the United States. It's unique and a huge benefit to our members." COMMERCIAL INVESTMENT REAL ESTATE / NOV.17 21 CCIM.COM

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