Tuesday, December 21, 2010

Happy Holidays from the Graaskamp Center!

We wish you all a very happy and safe holiday! Please note that the Center will be closed for the holidays on December 24, 30 and 31. We look forward to connecting with you in 2011!

Monday, December 20, 2010

Observations on Essays, Blogging, and Reading for Life

by Stephen Malpezzi, Professor and Lorin and Marjorie Tiefenthaler Distinguished Chair in Real Estate

Regular readers of Wisconsin Real Estate Viewpoint have read some of my missives about “Reading for Life.” Some of you may have even downloaded the very long list (pdf) I’ve posted at my web page on selected teaching materials.

Given my research and teaching interests, it’s no surprise that most of the readings I’ve pointed to relate to real estate, economics, cities, globalization, etc. Today let me step out of my usual zone.

This morning reading The New York Times (paper version! I’m old school) I ran across a short article playing off Sarah Bakewell’s new book, How To Live: Or A Life of Montaigne in One Question and Twenty Attempts at an Answer.

The article, “Conversation Across Centuries With the Father of All Bloggers” (Patricia Cohen, published December 17, 2010) caught my eye because I remember reading some 16th century Montaigne essays many, many years ago. Certainly there were short-form writers before Montaigne – many classical authors from Greek and Roman days, Pauline Epistles and Montaigne’s near-contemporary Francis Bacon come to mind. Nevertheless, Montaigne is considered by some as the father of the essay as we know it today.

Although I’m not sure there is a water-tight definition of the essay. Subjects are all over the map; it’s usually (not always!) a shorter piece; and an essayist often puts forward a personal point of view. Why, it seems I am writing a short essay now! You’re an essayist too – if you’re a current or past student at Wisconsin Real Estate, you surely wrote a number of personal essays explaining why you’d make a great addition to the Badger student body, the Wisconsin School of Business, and perhaps the Graaskamp Center.

As the title of Cohen’s article suggests, one of the points that Bakewell makes in her book is that the essay is the precursor of the blog. Short, personal, and written on a variety of topics. Sounds like the Wisconsin Real Estate Viewpoint to me!

So it’s time to add some of my favorite essayists to Reading for Life.

One of the great things about the internet is that many of the great essayists of the past is that their work is now in the public domain and available for free. I like aphorisms, so I spent a little time browsing George Bernard Shaw’s essay Maxims for Revolutionists. What I like about Shaw’s aphorisms is how he turns the way I usually think upside down. For example, in the Tradition and Innovation paper I briefly discuss the “golden rule” approach to some ethical questions; but Shaw the economist reminds me that there are exceptions: “Do not do unto others as you would that they should do unto you. Their tastes may not be the same.” Consumer sovereignty!

We just had a very successful Graaskamp on the Road in New York, which brings to mind another favorite, E.B. White’s 1949 essay, This is New York. Part paean, but also very clear-headed and realistic.

White, like many other top essayists, often wrote for The New Yorker. One could spend weeks reading great essays from this single source – James Thurber, Joyce Carol Oates, Calvin Trillin and John McPhee come to mind.

James Graaskamp himself was no mean essayist – Principles of Real Estate Development and A Rational Approach to Feasibility Analysis are among his works that fit the form.

Perhaps thinking about the great essayists will help me be a better blogger. The next time I make it over to the reference section of Memorial Library I’ll have a look at Tracy Chevalier’s 1997 Encyclopedia of the Essay.

But in the meantime I downloaded a free version of Montaigne’s collected essays, to browse through when I need a break from grading. Leave a comment with your favorite essayist!

Photo by Djof via Flickr

Wednesday, December 15, 2010

Rose Bowl construction facts

Rose Bowl, 1963

Rose Bowl fever continues here on campus in Madison. Curious about the history of the Rose Bowl and construction of the stadium itself, I visited the Rose Bowl Stadium's official website. There, I found they have a great feature--"154 Facts About the Rose Bowl Stadium"--summarizing important dates in the stadium's history.

Particularly interesting, I thought, is how over the course of the 88 years since it was built you can see how not only the capacity has changed/expanded but also how the facility has been modified to meet the needs for accessibility, earthquake safety, modernization and more. Also available on the website are plans for further proposed improvements for "The Next 100 years."

Below are some of the construction/renovation-related highlights. Visit the Rose Bowl Stadium website for the complete list of "154 Facts."

1922 Construction of the horseshoe shaped stadium is completed with a seating capacity of 57,000. Designed by Myron Hunt, the stadium cost $272,198.

1922 The Tournament of Roses Association built the Bowl in the Arroyo, a ravine of parkland and natural vegetation on the west side of Pasadena.

1923 The stadium is named "The Rose Bowl" and is dedicated hosting its first college football game.

1928 Rose Bowl Stadium enlarged by 19,000 seats, increasing seating capacity to 76,000.

1931 Wooden sections of the Rose Bowl are removed and replaced with reinforced concrete. The addition of 10,000 seats increased total capacity to 83,000.

1937 Seating is increased to 87,677.

1949 Stadium is enlarged to seat 94,410 - $335,000 improvement.

1950 Fourth expansion increased capacity to 100,983. The Rose Bowl Game becomes the first bowl game to have 100,000 spectators in attendance.

1969 Wooden benches are replaced with aluminum seating.

1982 An eight-year project to add earthquake reinforcements to the stadium structure begins. Locker rooms are again remodeled, a new sound system is installed, and parking areas are also improved.

1991 Tournament of Roses Association accepts the city's request to renovate the press box, tripling capacity to more than 1,000.

1992 Construction completed on $11.5 million three-level structure at the Rose Bowl providing state-of-the-art facilities for both news media and spectators in the Executive and Club Suites. The seating capacity was increased form 330 to 1,200.

1993 The Rose Bowl is designated as an engineering landmark by the American Society of Civil Engineers. After many renovations, The Rose Bowl seating capacity is 104,594 people.

1993 $2 million renovation of the Rose Bowl is a gift from World Cup USA 1994 Inc. to the City of Pasadena. The field is widened to 224 feet and 345 feet long. Permanent ramps are installed for the disabled. Capacity - 100,184

1996 The Rose Bowl undergoes a $21.5 million renovation including a new sound system, scoreboards, video board, elevator with field access and restrooms.

1997 Disabled access increased. Seating capacity reduced to 98,636.

2007 In August 2007, a 40,000 square foot state of the art new locker room and media center space were added.

The Wisconsin Badgers will meet the TCU Horned Frogs in the 97th Rose Bowl Game on January 1, 2011 at 4:10 pm CT.

The photo above is from the Badgers' 1963 Rose Bowl Game appearance, featuring "Lou Holland of the University of Wisconsin--Madison Badgers running around the end." Image courtesy of University of Wisconsin Digital Collections, via Flickr. Also, be sure to check out their amazing series of football team photos from as far back as 1890!

On Wisconsin!

Tuesday, December 14, 2010

"The Big Bank Theory"

This is probably one of the hottest video clips watched in central banks around the globe. When asked about it, Abdullah Yavas, our central bank insider and voting member of the Monetary Policy Committee of the Central Bank of the Republic of Turkey, commented "Central banking is about expectations management, and credibility is one of the most crucial assets of a central bank in managing expectations. It takes years to build credibility, and a wrong policy to destroy it."

The Daily Show With Jon StewartMon - Thurs 11p / 10c
The Big Bank Theory
Daily Show Full EpisodesPolitical Humor & Satire BlogThe Daily Show on Facebook

Monday, December 13, 2010

Connect with us on Facebook for a chance to win!

We want you to connect with the Graaskamp Center on Facebook.

When you do, you'll find out about one of the country's leading real estate undergrad and MBA degree programs, stay informed about Wisconsin Real Estate events and activities, connect with other alumni and friends of the program--and if you become a fan before December 27th, you could win a 2011 commemorative Badger Rose Bowl t-shirt.

We'll choose the winner Monday December 27th and mail out the t-shirt right away so you can wear it with pride on January 1st as you watch the game.

But if you're already a Facebook fan, don't worry. We'll choose the winner from among ALL of our fans.

So share your passion for Wisconsin Real Estate on Facebook--and your passion for the Badgers!

On Wisconsin!

Thursday, December 9, 2010

Real Estate and Badgers Football

Excitement on campus is high as the UW Badgers football team prepares for its 2011 appearance at the Rose Bowl. As the semester winds down, alumni, students and fans are busily making plans to watch the game. Tickets may be hard to come by, but that hasn't dampened the enthusiasm. It's the seventh trip to Pasadena in school history, and the team's first time since 2000.

All the talk about Badgers football reminded us of Wisconsin Real Estate's football connection through real estate graduate and current Cleveland Browns tackle Joe Thomas. Thomas graduated in 2007 with a B.S. in Real Estate and Urban Land Economics and was subsequently drafted by the Browns.

We looked back in our news archives to June 2007 for an interview we did with Thomas talking about his interest in real estate, what he got out of the program, and his strong work ethic. Here is an excerpt:

What did you like about real estate?

“I think real estate is more hands-on than a lot of other majors. You’re doing a lot more stuff in the field, not so much sitting in a cubicle or at a desk. And just about everybody is affected by it. Anybody who plans on owning a house, it’s such a big advantage to take a real estate class, and to be able to know about a mortgage, what your best options are when buying a house or looking for property.”

What real estate classes did you take, and were they challenging?

“I took Real Estate Process, with Sharon McCabe; Valuation and Appraisal, also with Sharon; Urban & Land Economics, with Morris Davis; Finance, with François Ortalo-Magné; and Residential Development, with Tom Landgraf.

“To me, the whole real estate program just makes sense. A lot of people who are really good at math say that it makes sense to them, and that’s kind of how real estate is to me. It's like a puzzle; everything fits together. It’s not just memorizing it, you just understand it.”

What else did you like about the real estate program?

“The networking and connections that you make. That’s part of the reason why this is the number 1 program in the country: you are involved with different groups, you do projects with each other, you form great friendships. The people you meet here are the people who are going to help you get a job down the line.”

To read the rest of the interview with Thomas, click through to our News Archive.

The Wisconsin Real Estate Program publishes a monthly newsletter with information on real estate events, activities and more. To receive your copy, add your email address to our mailing list at Constant Contact.

Tuesday, December 7, 2010

Career outlook and on-campus recruiting

According to an article in this week's Wisconsin School of Business Gazette,
On-campus recruiting statistics appear promising after the recruiting slump of the 2009-2010 academic year.

The MBA Career Management Center reports growth in the number of organizations coming to campus to interview MBA students. There was a 30% increase over last year in on-campus recruiting, including the additions of highly regarded companies such as 3M, Colgate-Palmolive, Simon Property Group, Tishman Speyer, and Rexnord Industries.
2011 is frequently mentioned as a transitional year for real estate as sectors begin to show signs of movement and improvement. Companies are now looking to fill vacancies that had been left open during the worst of the crisis. Many firms believe they will be net hirers in 2011.

The Wisconsin Real Estate Club is actively reaching out to companies to participate in its 2011 career fair to be held on February 9th in Madison. The 11th annual event brings together nearly 200 undergraduate and MBA students and employers in a range of real estate sectors for a concentrated evening of networking.

This year's event kicks off with an open house in the offices of the James A. Graaskamp Center for Real Estate, followed by the evening expo in the Plenary Room of Grainger Hall, and concluding with a reception in the East Atrium.

Wisconsin's best and brightest real estate students are available for internships and full-time employment. Companies are encouraged to sign up now for best placement for the expo and to make the most of time on campus by announcing internship or job openings ahead of time through the online recruiting system. Employers can start collecting student resumes right away and even schedule interviews in advance.

Past participants in the career fair have included T. Wall Properties, NAI MLG Commercial, Heitman, Dominium, Transwestern, Harrison Street Capital, Northwestern Mutual, Ernst & Young, U.S. Bank, Ridge Property Trust, Waterton Residential, Grubb & Ellis, Apex, Realogic, and others.

Every February, the Real Estate Club hosts a career fair featuring representatives from regional and national companies looking to connect with Wisconsin’s talented pool of real estate students. The Club, one of the largest and most active student-run organizations on campus, is open to graduate and undergraduate students.

To find out more about the career fair and to register, visit the career fair website.

Monday, December 6, 2010

Competing in the National Real Estate Challenge

Meet Our Current Students, a continuing series featuring some of our first-year real estate MBA students:

Recently I was fortunate enough to take part in the National Real Estate Challenge, a real estate case competition held annually in Austin, Texas. The competition was held on November 17-18 and was hosted by the McCombs School of Business at the University of Texas. I was part of a six-person team comprised of MBA students in the Graaskamp Center for Real Estate. We competed against nineteen other teams representing leading business schools from around the country. Members of this year’s team were second-year students Chris Hammes, Lindsay Kruger, and Jeff Swhier and first-year students Tess Gruenstein, and Eric Hansch and myself. Lecturer Arif Qureshi was the faculty advisor. The Wisconsin team was one of only a handful of teams that included first-year students.

The case in this year’s competition deviated quite a bit from years past. Usually involving the development of an asset, this year’s case involved the capital restructuring of one firm’s investments in two parcels of lands that were mortgaged by the same lender. One parcel of land was undeveloped and located in a weak market. With the value of the land decreasing, the owner had stopped making debt payments on this parcel. The second parcel was split into two phases, one being undeveloped but entitled for the development of an office building, and on the second sat a recently completed but vacant office building. The second parcel was in a strong market and was expected to begin generating significant cash flow shortly. With loan maturities and loan covenants coming due and no current cash flow, alleviating the lender’s risks as well as keeping the upside potential of the second parcel for the investment firm was the ultimate goal. The case also described a proposal created by the investment firm, laying out their strategy for talks with the lender. Goldman Sachs provided the case which was based on an actual investment they have made.

Each team had 72 hours to read the case and create and complete a PowerPoint presentation explaining the current situation as well as the optimal strategy from the viewpoint of the investment firm. Once the competition began in Texas, the teams were split into groups of five. Each group made a twenty minute presentation before approximately ten real estate professionals who were judges. A ten minute Q&A session followed where the judges tested the participants’ strategy as well as their understanding of the case and the real estate principles involved. One team from each of the five groups was then selected to compete in the final round.

Our team developed a strategy that was quite unique and very different from the investment firm’s proposal. Our strategy involved selling the speculative land and using the proceeds to buy down the risky loans, easing the lender’s concerns. The excess proceeds would be used for tenant improvements on the completed office building, increasing that asset’s potential for significant positive cash flow in the short term. This plan would require no additional equity from investors. Unfortunately, the Wisconsin team did not advance to the finals as we lost out to the eventual champion, the team from Wharton.

While the outcome was not what we had hoped for, the competition was still a very rewarding experience. It allowed us to take what we learn in the classroom and apply it to a real world situation while also forcing us to work with each other’s strengths and weaknesses as a team. An added benefit was meeting and socializing with the students from the other schools as well as the industry professionals. As a first year student, I am excited about the opportunity to compete in this and other case competitions during my remaining time as a student at the Wisconsin School of Business.

Eric Dowling is a first-year MBA student in the James A. Graaskamp Center for Real Estate. Eric plans to combine his previous real estate experience with his MBA education to establish a career in private equity investments.