Accurately assessing the value of hotel intellectual property is critical when structuring the most advantageous deal. This course is designed to help you develop a high level of financial sophistication so you can properly assess hotel management agreements and franchise agreements, as well as assign value to the real assets.
Professor Jan deRoos will guide you through the valuation of management agreements as well as franchise agreements using Excel-based spreadsheet tools. You will examine how debt and equity capital markets are used to financially engineer enhancements in the value of the real estate. To make sound financing decisions, you will calculate the costs of many of the commonly used mortgage loan features. Finally, you will explore how private equity sponsors design cash flow distribution mechanisms to align incentives and to achieve high returns.
This course emphasizes the role of debt capital in creating value for equity and the role of public and private equity in modern real estate capital markets. Throughout the course, you will use sophisticated spreadsheet tools to support and quantify the analyses, all of which can be used to analyze real-life opportunities.
These courses are required to be completed prior to starting this course:
Financial Analysis of Hotel Investments
Control of Hotel Real Estate
Developing an Asset Management Strategy
Achieving Hotel Asset Management Objectives
Valuing Hotel Investments Through Effective Forecasting
WHAT YOU'LL LEARN
Estimate the value of hotel management agreements and their impact on shareholder value
Estimate the value of franchise agreements and their impact on shareholder value
Calculate the true costs of loans, taking into account a wide range of possible fees and features
Calculate the cash flow "waterfall" that is part of the promote structure in a private equity fund
Model duration to clarify the timing of cash returns and determine the modified internal rates of return (IRR)
Professor, The Hotel School, Cornell SC Johnson College of Business
Jan A. deRoos is the HVS Professor of Hotel Finance and Real Estate at the Cornell SC Johnson College of Business. He has devoted his career to teaching and research related to hospitality real estate, with a focus on the valuation, financing, development, and control of lodging, timeshare, and restaurant assets.
DeRoos has developed two online executive education programs for real estate professionals; one with a broad real estate industry perspective and a second that focuses on lodging. He co-developed a free web-based tool, the Hotel Valuation Software, with Stephen Rushmore of HVS International. His book on hotel management agreements, co-authored with the late James Eyster, is the seminal academic publication on the topic.
Prior to joining Cornell, deRoos worked extensively in the hotel industry as a construction and engineering manager.
Managers and professionals with financial or operational responsibility of hotel real estate, investments, financing, or asset management including asset managers, portfolio managers. Professionals working for or aspiring to work for real estate funds, REITs, real estate developers, real estate advisory firms, and others affiliated with the creation and use of real estate as a financial asset, focused on hotel real estate investment projects.
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