Fall 2002 - PLUS 543



Spring 2008 Friday, January 18 and 5 additional Saturdays

Allan D. Kotin Classroom TBA

akotin@ 213.623.3841

USC - SCHOOL OF POLICY, PLANNING & DEVELOPMENT

PPD 599 - PUBLIC/PRIVATE JOINT VENTURES IN REAL ESTATE (INTENSIVE)

SYLLABUS

Objective of Course

To familiarize students with the origin, motivations, character and results of public/private transactions involving real estate development. Within a framework of institutional constraints and participant motivations a set of categories of transactions is defined. Much of the course is spent in exploring the ways in which these types of transactions manifest public policy and private goals in different specific situations. The course seeks to highlight the special opportunities and requirements in negotiating effective Public/Private Joint Developments, as contrasted to purely private development.

Teaching Method

The class is taught in mixed lecture and interactive format. Limited student participation is stressed in the review and updating of individual case studies. Students are encouraged to make contact with the actual participants so the motivations and evolution of the transaction can be shared with the class. Students should some knowledge of real estate finance.

SCHEDULE OF CLASS TOPICS AND EVENTS

There is extensive reading and at each session each student must bring to class a specific written question based on the readings, in a format specified on Blackboard. Except for the first session, all sessions will be scheduled for 6 hours including a one-hour break. Each full sessions will be divided in two topic sessions. There will be a quiz in each full session except sessions 1 and 6. There will be no midterm exam.

Session/Date/Topic

1. (Half Session, January 18, 2-5)

Introduction and Categorization of Transactions

Review course format and content; discuss framework for public/private joint ventures; role of joint real estate development in broader context of public/private partnership; initial definition of public/private joint ventures.

Review asset based and need based transactions; review three general types of joint ventures; examine motivations and objectives of each party; discuss applicability to different property types; introduce description of asset management and redevelopment.

2. (Full Session, February 2, 9:30 – 3:30)

2 A. Introduction to Redevelopment

Review origins of redevelopment law in California; Note generally other state models with and without tax increment; Review powers and limitations of redevelopment agencies in California.

2 B Critical Issues in Redevelopment Transactions

Property acquisition and condemnation issues; future recovery of public subsidies reimbursement for public expenses; guarantees and penalties; good faith negotiation.

3. (Full Session, February 16, 9:30 – 3:30)

3 A Asset Management as a Basis for Public/Private Joint Ventures

Legal basis for asset management; Los Angeles County and university experience; special issues with

School districts; transaction formats; joint development with transit.

3 B. Asset Management Continued: Ground Leasing

Review of alternatives; benefits of ground leasing, key terms; financial issues; administrative problems.

4. (Full Session, March 1, 9:30 – 3:30)

4 A Transaction Initiation and Formats, Preparation of Requests for Proposals (RFPs)

Preparing and responding to properly drafted RFPs are often the critical first steps in successful private/public joint ventures. A detailed discussion of the purpose and contents of requests for qualifications (RFQs) and requests for proposals (RFPs) issued by public agencies, including a critical treatment of how to elicit the best responses and then to select among them. Specific examples will be distributed and discussed.

4 B Special Issues in Retail and Housing Projects

Issues governing why and how cities seek new retail and housing development, what inducements of

what inducements are offered, and three case studies of recent development will be discussed.

5. (Full Session, March 16, 9:30 – 3:30)

5 A Review of Transaction Structures March 15, 9:30 – 3:30

This session will explore distinctions between front end assistance and performance base assistance on one hand and also different forms of capital event participation. Case studies will be given of how different structures were used to solve different problems.

The course will conclude with a discussion of practitioner guidelines and a student-directed review of key topics in the course requiring further elaboration..

5 B Downtown Renewal and Practitioners Guide

At the beginning of the course each student will select a previously completed case study and track it through the various issues in the class. In this, the final half session, each student will present a brief critique and review of his transaction together with some updating.

6 PRESENTATION OF STUDENT PROJECTS March 29, 9:30 – 3:30

FINAL EXAM TO ADMINISTERED BY EMAIL AT A SCHEDULED TIME AFTER SESSION 6

Basis for Determining Grades

Student participation includes the submission in writing at each session of a question based on the reading for that session. Selected questions will be answered in class.

Class grading is based on the following general formula:

Class quizzes 25%

Final Exam 40%

Case study update 15% 25%

Submission of written questions 10%

Student participation in class 10%

The case study update consists of updating and critiquing a project previously submitted in this class which each student will select from a portfolio presented in the first class.

Required Readings

Introduction to Redevelopment, California Redevelopment Association, First Edition, September 1996.

If as expected, this publication is still out of print, the instructor will post required readings on BLACKBOARD

The Reluctant Metropolis, The Politics of Urban Growth in Los Angeles, William B. Fulton, Solano Press, August 2001

Reading assignments and additional handouts will be posted on USC’s BLACKBOARD prior to the first class and each week thereafter.

Recommended Reading

The following items provide useful background and/or additional detail for various topics as indicated.

Professional Real Estate Development, Peiser, Richard B., Urban Land Institute This is a useful guide to real estate feasibility and market analysis for those with little real estate background

California Community Development Act, a practitioner’s guide published by Best, Best & Krieger, LLC, This is an annotated copy of the law with explanations and comment by one of the largest redevelopment law firms in the state which can provide a useful detailed reference for those seeking such detail. Although currently out of print, individual copies may be requested from the firm.

Guide to Public Debt Financing in California, [Rev. Edition], Horler, Virginia, L., Packard Press, 1998 This document, excerpts of which will we distributed on BLACKBOARD can be useful in providing additional technical detail on the statures and practice governing public finance in California

Guide to California Planning, William Fulton ,Solano Press Books (paperback), 2nd Edition 1999 This is a planning text which has some useful discussion of redevelopment in the planning context.

Student with Disabilities

Any student requesting academic accommodations based on a disability is required to register with Disability Services and Programs (DSP) each semester. A letter of verification for approved accommodations can be obtained from DSP. Please be sure the letter is delivered to me as early in the semester as possible. Your letter must be specific as to the nature of any accommodations granted. DSP is located in STU 301 and is open 8:30 am to 5:00 pm, Monday through Friday. The telephone number for DSP is (213) 740-0776.

Academic Integrity

The University, as an instrument of learning, is predicated on the existence of an environment of integrity. As members of the academic community, faculty, students, and administrative officials share the responsibility for maintaining this environment. Faculties have the primary responsibility for establishing and maintaining an atmosphere and attitude of academic integrity such that the enterprise may flourish in an open and honest way. Students share this responsibility for maintaining standards of academic performance and classroom behavior conducive to the learning process. Administrative officials are responsible for the establishment and maintenance of procedures to support and enforce those academic standards. Thus, the entire University community bears the responsibility for maintaining an environment of integrity and for taking appropriate action to sanction individuals involved in any violation. When there is a clear indication that such individuals are unwilling or unable to support these standards, they should not be allowed to remain in the University.

Academic dishonesty includes:

• ·Examination behavior - any use of external assistance during an examination shall be considered academically dishonest unless expressly permitted by the teacher.

• ·Fabrication - any intentional falsification or invention of data or citation in an academic exercise will be considered a violation of academic integrity.

• ·Plagiarism - the appropriation and subsequent passing off of another’s ideas or words as one’s own. If the words or ideas of another are used, acknowledgment of the original source must be made through recognized referencing practices.

• ·Other Types of Academic Dishonesty - submitting a paper written by or obtained from another, using a paper or essay in more than one class without the teacher’s express permission, obtaining a copy of an examination in advance without the knowledge and consent of the teacher, changing academic records outside of normal procedures and/or petitions, using another person to complete homework assignments or take-home exams without the knowledge or consent of the teacher.

The use of unauthorized material, communication with fellow students for course assignments, or during a mid-term examination, attempting to benefit from work of another student, past or present, and similar behavior that defeats the intent of an assignment or mid-term examination is unacceptable to the University. It is often difficult to distinguish between a culpable act and inadvertent behavior resulting from the nervous tensions accompanying examinations. Where a clear violation has occurred, however, the instructor may disqualify the student’s work as unacceptable and assign a failing mark on the paper.

Return of Course Assignments

Returned paperwork, unclaimed by a student, will be discarded after 4 weeks and hence, will not be available should a grade appeal be pursued following receipt of his/her grade.

599PPJVSYLLABUSF-INTENSIVE-SPRING08.DOC

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