Real Estate Megaprojects: Private/Public Partnerships
Pre-requisite: Real Estate Practice or Real Estate Finance
This seminar will explore the transactional intersection where government meets the private real estate world. At this intersection, the parties seek to achieve the classic "win-win" objective. For government, the objectives are about creating, growing and attracting job producing businesses, promoting blight removal and healthy neighborhood development, increasing the supply of affordable housing and growing the tax base.
In the seminar, we will concentrate on the the tools government uses to induce private investment where the associated risks might otherwise discourage potential market participants -- particularly in a depressed economy. Topics will include tax advantaged financing opportunities achievable through industrial revenue bonds issued by statutorily created local industrial development agencies, the reduciton of state and local tax exposures through tax abatement/exemption opportunities afforded through different legal vehicles and the substitution of payments-in-lieu-of-taxes for the taxes otherwise due and payable, land deals for publicly-owned land at below-market costs, and the public commitment to infrastucture renewal and replacement--as well as governmental direct investment in the project. Techniques of return on and of investment by government and the analysis of such return will be covered to understand the dynamics of government decision-making. The seminar also explores zoning initiatives and the mobilization for private development of "specialty: government-owned real property -- particulary waterfront prperty -- to promote municipal growth and prosperity.
Students will study and analyze selected features from the documentation of a few projects to obtain an inside look at these specialized transactional structures.Grading and Method of Evaluation
Letter grade with pass/fail option. A paper is required which may be used to satisfy the Upperclass Writing Requirement. The paper will explore, explain and analyze salient aspects of a prominent public/private deal from any jurisdiction within the United States and must pay particular attention to the legal foundations and structures of the deal.