A Real World Exercise in Residential Development
The Residential Development course at Cornell gives first-year Program in Real Estate (PRE) students and others an opportunity to take on the challenge of developing or re-developing an actual site for residential use. Students work in teams throughout the spring semester to prepare an analysis of the site. Pike Oliver, senior lecturer in the PRE, teaches the course and has worked in land acquisition, planning and development since the 1970s. He has planned both large and small residential communities, primarily in the western United States. Oliver was a principal of his own firm and also worked for larger firms, including The Irvine Company in Southern California.
The course truly encapsulates the real estate industry as it takes a multi-disciplinary approach. The curriculum incorporates principles from architecture, engineering, finance, law, and sales. Students experience the process from a developer’s perspective: touring the proposed site, performing a market study, creating an entitlement strategy, defining product concepts, preparing financial projections, crafting the site plan and product mix, preparing a comprehensive feasibility analysis, and presenting the final project recommendations to the developer. Sam Bechthold, PRE 2011, commented that the course “gave me the opportunity to apply my coursework to date in a real world exercise. It also opened my mind to infill residential development opportunities and taught me how to approach those types of projects.”
Oliver is currently finalizing the location of the site for the spring 2011 course. Last year’s site was a 2.5 acre property in Philadelphia owned by Toll Brothers, Inc., a NYSE-traded Pennsylvania-based luxury homebuilder. Last year students traveled to Philadelphia to walk the site, surrounding neighborhood, and competing projects. Students worked in teams to create a comprehensive plan that would complement existing uses near the site.
Toll Brothers’ assistance took the form of both classroom and on-site briefings; identifying the site’s strengths, weaknesses, opportunities, and threats; and explaining other due diligence items. Working in teams of five to six, students determined the land’s market opportunity and derived a program incorporating the site’s highest and best use. Each team provided Toll Brothers with a formal written report; an oral presentation; and their illustrated vision for the site with detailed schematic drawings, plans, sections and massing models. Teams then used their design to project development costs and investment returns. Lastly, all students received thorough feedback from both faculty and Toll Brothers after the final presentations. This real-world connection, with continual feedback from industry professionals, is one of the major strengths of Cornell’s Program in Real Estate.