Wednesday, March 27, 2013

Blog 2: The Entrepreneur: Where It All Begins By Jazmin Padilla

             Blog 2: 
The Entrepreneur: Where It All Begins 
By Jazmin Padilla
Photo taken from

        When a new shopping mall opens or village center is created, it can be traced down to the entrepreneur, as known as the developer. In fact, it is that very developer who is responsible for the creation of space for humans and the community as a whole to gather and enjoy. Think of how valuable places such as Riverpark in Fresno, CA have been to its citizens. It is place where family and friends gather to socialize and enjoy stress free, quality time. Without the vision of the developer, it would not exist. Thus, the developer is at the center of all real estate activity. For that very reason, I find it best to look into the entrepreneurial activity in the real estate model in much greater detail. What does it mean to be a real estate entrepreneur? For current or prospective entrepreneurs it is important to understand the process of project development. In addition, a section will discuss the value of relationships and networking for the developer.
        Many assume to be an entrepreneur or developer, one must be wealthy. That a developer finds a location and buys it immediately. That is simply not the case. First and foremost, a developer can include an individual, a partnership, an organization, or even the government. Developers also can consist of a mixture of the individuals and entities working together. For example, many local governments often times partner with private developers, working together in the creation of public parks in order to develop space for human activity and thus, strengthen the community.  In Fresno, CA the non-profit organization, known as the Poverollo House, is currently working with real estate developers and architects to better serve the need of the homeless in the community. Though the traditional one-man entrepreneur who creates success from nothing does exist, being a developer has a very wide scope of ties and forms. However, there is still a common process to which projects are completed.
  Within project development there is an ordered stage process. I will discuss the list described in Real Estate Analysis by J. Diaz and J. Andrew Hansz. The list is a six stage process, with Stages 1-3 being the pre-committment stage, where many hours of intense research are done but very little financial investment has occurred. Stages 4-6 is considered the postcommitment phase, where the developer has decided to go full force with the project and invest most of his resources and time into the project. 

  • Stage 1: Conceive a Development Project 
One must define a concept and target market. After narrowing down the target audience, the developer must find a site that will provide the highest and best use for the project. Furthermore, one must generate rough financial numbers such as a “back of the envelope analysis,” and preliminary pro-forma.
  • Stage 2: Examine the Feasibility
The developer must perform due diligence, including zoning, permits, easements, and many other legal and environmental issues. The developer may choose to gain control of the site during this step as well, with an exclusive option to buy the site during some future period of time.
  • Stage 3: Refine the Concept
This step involves diving into greater detail. Refine your design and target audience. One must get feedback from the public and understand the demand for the proposed project. Furthermore, one must gauge if there is sufficient capital to develop the project. 
  • Stage 4: Design the Project
The developer has decided to continue on with the project in full force. This stage includes formalizing financial and construction documents, obtaining a design of the project, finalizing equity and lender commitments, contracts, etc. Marketing begins during this stage as well.
  • Stage 5: Construct the Design
The construction of the project occurs. Managing lender inspections and administering payments for the development takes place. Government issues a shell certificate of occupancy.  
  • Stage 6: Manage the Asset
The developer must decide to sell the asset or hold for long term investment. This stage involves the physical maintenance of the property and cash flows generated from the project are as expected or not.

        Throughout the entire process, the developer is using outside resources and pulling from his or her network of sources. Relationships are essential to the success of a real estate entrepreneur. A developer needs a reliable team bringing more insight and knowledge to the project. However, services of top-notch professional can be quite pricey and for that very reason, it is valuable for the entrepreneur to build his professional relationships. Having a trustworthy network of professionals can save an entrepreneur not only money but time, if a project is not considered a good deal. The importance of relationships are very useful during the pre-commitment stage when expert opinions are needed before the entrepreneur decides to go forward with the project as well.
        Real Estate is a journey. It begins with a vision from an entrepreneur. Though it might seem like a simple, I dream it and now I’m going to build it process, it is not. There are many steps and investigating done before even purchasing a site. A successful developer will perform his or her due diligence before entering the postcommitment stage. And with the help of a network of relationships places, such as Riverpark are created for the community to enjoy. 


Diaz, J. and Hansz Andrew J. Real Estate Analysis: Environments and Activities. Lowa: Kendall Hunt, 2010. 

Tuesday, March 26, 2013

CH.8 Questions By Jazmin Padilla

CH.8 Questions
By Jazmin Padilla

1. Part of conceiving a development project includes all of the following except:
  1. Finding a site
  2. Preparing a preliminary pro forma
  3. Defining a concept
  4. Purchasing a building 

2. Which of the following is part of the commitment stage of entrepreneurial activity?
  1. Constructing the design
  2. Examining project feasibility
  3. Conceiving a project
  4. None of the above

3. “Back of the envelope” analysis would include a detailed and thorough analysis of the site financials. 

4. Relationships are extremely valuable during the pre-commitment stage of development. 

5. In order to gain control of the site the developer must purchase the property immediately. 

6. At which stage does the development change from pre-commitment to postcommitment?
  1. Stage 3 Refine the Concept
  2. Stage 4 Design the Concept
  3. Stage 5 Construct the Design
  4. Stage 6 Manage the Asset

7. The duration of a construction loan matches the period of construction and must be paid upon completion of the project. 

8. A developer will most likely favor free rent over tenant improvements. 

1. D 2. A 3.F 4.T 5.F 6.B 7.T 8.F

Wednesday, March 20, 2013

Ch.7 Questions By Jazmin Padilla

Ch.7 Questions
By Jazmin Padilla
1. Externalities arise because of real estate’s fixed characteristic.
2.   Police powers includ:
a.       Right to regulate property for welfare of public
b.      Zoning rights
c.       Subdivision codes
d.      All of the above
3.Eminent domain is (the noun) completed by the process of condemnation (the verb).  
4.The use of eminent domain for urban redevelopment is a commonly accepted use.
5. Keys to a home are considered part of the fixture due test of adaptability.
6.Private rights supersede any public rights.
7.A cable line that runs with the party is an example of a
a.       Easement in gross
b.      Conservation easement
c.       Easement appurtenant
d.      Holdover tenant
8.A corporation known as a single entity will have which of the types of ownership:
a.       Tenancy in common
b.      Tenancy by entirety
c.       Ownership in severalty
d.      None of the above

1)T  2)D  3)T  4)F  5)T  6)F  7)A  8)C

Ch 7 questions

BY Matthew Seely

Fee simple estates are the broadest and most complete bundle of rights?



In regards to Eminent domain the government can take your property for private use?



Intestate means what?

A.       Die with a will in place

B.      You have intestinal issues and need to see a dr.

C.      You don’t have a will

D.      You inherit property from your grandmother.

When you die in testate, you die with a will in place?



These would all be considered a fixture except.

A.      Kitchen sink

B.      Bath tub

C.      Kitchen Cabinets

D.      Refrigerator

Easement appurtenant has a Payee and a Payor.



With Adverse possession people can get some owner ship rights in your property.




In order for someone to claim adverse possession they have to do all of the fallowing accept.

a.       They have to be invited on the property

b.      It has to be hostile

c.       It has to be open( they can’t hide the fact that they are using the property)

d.      It has to be continuous ( they have to occupy it for the statuary amount of time, like 7 to 10 years)

Monday, March 18, 2013

Chapter 6 Questions by Albert Chang

Chapter 6: Markets and Environments
By: Albert Chang

1.) Investment returns that are excess of market expects given are not diversifiable is the efficiency return. (T/F)

2.) The equilibrium market price are the price of supply and demand in balances. (T/F)

3.) The Free Market is market that operates freely from the government or outside control. (T/F)

4.) Homogeneous Product are the product of every other seller that are not identical to the product of the same seller. (T/F)

5.) Product that can move from areas of relatively low demand is?
a) Perfect Knowledge
b) Critical Mass of Market Participants
c) Free Market
d) Product and Input Mobility

6.) The unique locational profile of a real estate site include quality of exposure and accessibility.
a) Situs
b) Corner of the street
c) Urban area
d) All the Above

7.) The negative growth in the stock funds deposited in short term accounts within financial are results when depositors withdraw their fund to invest in the capital market.
a) Mortgage market
b) Government Bonds
c) Disintermentdiation
d) Economic  fundamentals

8.) The abbreviatione GSE stands for General sponsored Economy. (T/F)

Answers: 1.)F 2.)T 3.)T 4.)F 5.)D 6.)A 7.)C 8.) F

Wednesday, March 13, 2013

Chapter 6 Questions
Arianna Sandoval

1.       In order for the Real Estate Market to be perfectly Competitive is should have at least the following characteristics
a.       Free Market
b.      Critical Mass of Market Participants
c.       Perfect Knowledge
d.      All of the Above
2.       In the short run the supply curve is showed as a upward sloping line T/F
3.       The market serving residential mortgage borrowers who do not qualify for standard mortgages is known as the
a.       Secondary Mortgage Market
b.      Mortgage Backed Securities
c.       Subprime Market
d.      Commercial Mortgage
4.       Mortgage Securitizations is pooling a large group of similar mortgages and selling them to investors T/F
5.       Intermediaries that match savers with borrowers include Savings & Loans, commercial banks, and insurance companies. T/F
6.       A private corporation created by an act of congress to stimulate and maintain the residential secondary mortgage market
a.       CMO
b.      GSE
c.       CDO
d.      CDS
7.       Unintended consequences result from actions government legislation have imposed with good intentions but result in economic and social costs that were not anticipated. T/F
8.       A Triple A rating is one of the riskiest T/F
1. D   2. F   3. C  4. T   5. T 6. B  7. T   8. F