Real Estate structured finance

How to analyse the risk and structure deals in an optimal way

Course objectives

  • Know how to use the main financial modeling calculations

  • Understand the different financing modes and types of transactions

  • Apply the method of discounted cash flows

  • Master the legal and fiscal environment of real estate investment

Course content

Introduction

  • Recent evolution of the Real estate structured finance in Europe
  • Legal, regulatory and fiscal environment of these markets

The main market players in the Real Estate industry and their rationale when seeking structured financing

  • Real estate developers. Construction Financing
  • Investors : Project financing and refinancing
    • The main Real estate investment vehicles and their impact in terms of risk:
      • Regulated vehicles: REIT's, Foncières SIIC, SCPI, OPCI
      • Non-regulated vehicles with or without recourse: SA, SAS, SARL, SNC, SCI and SCA
    • The main investment asset types: « Core », « Core+ », « Opportunistic »
  • Corporates. The externalisation strategy of their real estate assets: « Sale and Lease-back » structures

Main structured financing techniques: structuring schemes, most usual terms and conditions

  • Mortgage or non-mortgage financing
  • Acquisition finance of LBO / Private Equity type
  • Portfolio acquistion finance
  • Sale and lease-back : structure OpCo / PropCo and Off Balance Sheet structures
  • Re - financing via securitisation (RMBS, CMBS)

How to optimise the deal structuring?

Risk analysis and Security Management techniques:

  • Sensitivity tests on Real estate finacial modeling. The main ratios of analysis DSCR, ICR, Investment yield
  • How to ensure an optimal Due diligence of the underlying asset ?

Case Study: Valuation of a Retail center owned by a European Retail investment Fund

Case Study: Analysis of the list of tenants on a portfolio of industrial (logistics) assets

  • Leverage : senior, junior or mezzanine debt
  • Subordination issues. How to organise the waterfall : IIPP and IPIP structures et l'organisation de la waterfall. Case study: Financing a mixed portfolio of hotel and office assets
  • Financial reliability of the Investing PropCo or OpCo
  • Financing distribution constraints: Club deal, syndication, securisation
  • The analysis methodology of rating agencies

Case Study: Moody's-rated and RMBS's program

  • Security and covenants

Conclusion and evaluation




Sylvaine Chubert

Sylvaine Chubert

Sylvaine has made much of her professional career in major banking groups (ING, Rabobank, BNP Paribas) where she performed commercial and risk management operations of Corporate, Trade Finance and Real Estate Project Finance. Sincemore than 10 years, she is also a visiting professor at the University of Paris Dauphine where she teaches in the Structured Finance Banking to the Finance Insurance Masters. Today she intervenes as a trainer and consultant to banks and large exporters.

Sylvaine Chubert also teaches :



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