Sum-up: real estate provide future cash flow <=> financial asset => involve: financial economics
real estate is defined by cash flow, magnitude, timing & risk <= determined in rental market => involve: urban economics
====>>>> commercial real estate analysis and investment = financial econs + urban econs
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Capital mar determine the opportunity costs n values of INVESTMENT & CAPITAL ASSETS n allocate the flow of financial capital (aka "money") to n among the underlying physical assets which in turn produce future real benefit flows that are the defining characteristic of capital asset.
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Corp. finance concentrates on applications relevant to the financial n strategic mgnt of large corp whose equity is usually traded on the stock exchange.
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Investments field studies applications relevant to individuals n institutions making investment decisions 'bout the wealth they own or manage.
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Yes, real estate is complex, data is less than perfect n decision makin will always be somewhat of an art. RE is neither rocket science nor heart surgery, n we'll never outgrow our need to always apply common sense. But both financial n urban econs are highly developed, sophisticated field of study. They contain a very impressive corpus of knowledge n toolkit of methodology, as rigorous as any branch of the social sciences.
[Preface - Commercial RE analysis & investment, 2nd Ed]
I'm reading this book. My plan is to finish it in June. Come on!
