December 11, 2003

Development is changing; training should be, too

  • A look at some emerging trends in real estate education
    Special to the Journal


    The education requirements of real estate practitioners have grown significantly in the past two decades. Overbuilding in the 1980s combined with questionable density choices have led to restructuring of capital markets and spawned more development restrictions.

    These are only a few examples of the increasing sophistication that has taken place. Presently, few graduate real estate programs address these broad shifts with a curriculum that responds to this constantly changing industry.

    Real estate has long been regarded as a trade requiring skills in both financial analysis and management. As a result, real estate education has been handled primarily through business schools. Some students are piecing together a real estate education through an elective-based curriculum.

    But for those seeking a comprehensive education in real estate, programs at the University of Washington, the Massachusetts Institute of Technology and Columbia University are on a short list of schools offering advanced degrees.

    Marion Cunningham, associate director of MIT's Center for Real Estate, highlights the core difference between a master's in business administration and their distinct real estate program. “Business schools treat real estate as a business entity, focusing on the financial analytics and quantitative aspects,” she said. “Our program is asset-focused and exposes students to all issues and facets that affect real estate.”

    The University of Washington, under the direction of James DeLisle, Ph.D., developed the Runstad Center for Real Estate. DeLisle wants to see real estate recognized as a unique asset class with fundamental theoretical foundations.

    “The industry profile will require a broader and deeper educational foundation,” DeLisle said. “Industry participants must have a firm understanding of real estate and capital markets while focusing on sustainable business practices.”

    The UW program sponsors a graduate certificate in real estate, and provides courses in areas such as market analysis, finance, development and feasibility. Students are enrolled full time in related graduate programs for a diverse, interdisciplinary educational background.

    Michael Buckley, director of the Columbia University Program in Real Estate Development, highlights the need for practitioners to balance multiple objectives and have a broad spectrum of skills. “Real estate professionals must have the theoretical framework for public policy and market research, combined with core competencies in real estate finance, feasibility, and management,” he said.

    Columbia's curriculum uses its access to the New York market to allow students to rapidly acquire real estate development and management skills.

    Both Buckley and DeLisle are lead proponents of an enhanced academic role in the real estate industry. Each of their programs hosts research centers that use faculty and student research to generate reports and gather data used by industry participants.

    Currently, the UW program and the International Council of Shopping Centers are working together on publication of the Journal of Shopping Center Research.

    Columbia University's Real Estate Development Program sponsors the Center for High Density Development. Its research seeks to prove the investment, infrastructure and workforce efficiency, and social benefits of high-density development, with access to real estate developers and financial institutions, as well as traditional grant sources such as foundations interested in Urban Policy and Smart Growth initiatives.

    Curriculum advances

    Many of these unique programs expand on a finance-oriented curriculum that has been central to real estate education throughout history. They include curriculum such as market analysis, asset management, real estate law, architectural design and construction technology as well as public policy.

    Planning/public sector curriculum is increasingly common within real estate programs as the political relationships emerging in real estate have grown increasingly tense. These classes shed light on the multitude of public relationships in real estate, and the unique potential to benefit from these relationships.

    Robert Paley, senior development director for the Avalon Bay Real Estate Investment Trust, highlights the current shift towards public/private collaboration. “Government has become more of a player in development. Developers require a set of specific skills and conceptual perspectives to successfully engage the public sector.”

    Additionally, real estate programs are using access to the architecture school, integrating curriculum with the various design fields. For example, both MIT and Columbia expose students to key trends in product design, maintaining that design will influence tenant retention, operating efficiency and revenue maximization.

    For Michael Buckley, a former architect and founder of Halcyon Ltd., a development consulting company, design is the most critical part of a development project. Buckley said the developer must properly manage the relationship with architect. “The developer requires a fundamental understanding of architectural design and must be able to understand the objectives of an architect,” he said.

    These programs exhibit a unique, multifaceted curriculum that is uncommon in traditional real estate education. Although they aren't suited for everybody interested in a real estate education, they provide an opportunity to enter a diverse discipline with a diverse education.

    For more information on individual real estate programs in the U.S., check the following Web site:

    Scott Lien is a graduate student in the Real Estate Development Program at Columbia University in New York City. He previously resided in Washington state for 26 years.

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