Written by Mark Ambrose.
The MSRE 509 Capital Markets course in Hong Kong has been a valuable and unforgettable experience. The content of this class was directly aligned with my primary reasons for joining the master’s program, was delivered in a setting that helped broaden my perspective, and encouraged me to think big. I want to pursue a master’s degree in real estate because I want a better understanding of the interaction between various real estate market components. I also wish to attain an understanding of the financial aspects of real estate projects and investment decision-making. The Capital Markets course directly addressed my interests.
Prior to this course, my knowledge of investment capital structure was somewhat limited to small syndicates, smaller projects and traditional (simple) organizations of debt and equity. As the size and scope of real estate investment grows, so does the daunting complexity. The knowledge gained through this course gave me the ability to work on larger commercial real estate projects upon my return. I studied the specific characteristics and construction of Real Estate Investment Trusts (REITs) and Commercial Mortgage Backed Securities (CMBS), mechanisms that are absolutely critical to the organization and financing of larger, more expensive real state projects. Learning about capital structures and sources has helped me unravel the bigger picture of how different types of investors—from life insurance companies and sovereign wealth funds, all the way down to individual investors—participate in large scale real estate investments. Now, I have the foundational knowledge and perspectives of how the pieces of large-scale investment come together and interact, allowing me to move beyond and potentially work on the large institutional investment level.
Taking this course in the Hong Kong setting was very influential. It is an incredible city that displays unique real estate market characteristics and a cultural fusion of Eastern and Western business systems. It was fascinating to explore a city that reflects the might of the Chinese economy as well as the freedom and variety of Western capitalist elements. The density and organization of the city was appealing; I came away from this Hong Kong trip believing there are many lessons that should influence urban growth in America, specifically, smart density and transportation. I lived in San Francisco for five years and it was incredible to compare San Francisco as a city to the vibrancy and efficiency of Hong Kong, which has essentially the same geographical size but more than seven times the population. It was honestly an embarrassing contrast riding the Bay Area Rapid Transit system upon my return, after enjoying the perfection of Hong Kong’s MTR system everyday for two weeks.
One of my favorite parts of the course was the guest lecture by Tony Lam of Delta International LTD. Tony, born in Hong Kong and educated in the US, is a real estate professional with a valuation background. Tony helped emphasize the global nature of real estate investment by telling us about his employer’s multi-national operations in America and elsewhere. After his lecture, I exchanged emails with Tony, striking up a relationship with him that I hope to maintain. It became clear that there is a possibility for collaboration between us in the future. This was an exciting and unexpected development from taking this class in Hong Kong.
My global mindset was greatly enhanced by the experience of taking this course in Hong Kong. Globalization will only accelerate into the future and this course helped me to think of US real estate as a global investment product. Foreign investment in American real estate is already widespread but I expect this participation to continue expanding in scope, and I am excited to have the knowledge to contribute and personally partake in this evolution.
Overall, it is difficult to fully quantify the benefits of this intersession experience. It was a wonderful professional and cultural immersion. It was illuminating to be in one of the world’s greatest cities and to learn about some of the more difficult aspects of real estate. One of my greatest hopes in pursuing this master’s degree is to get a handle on the most complex financial elements of real estate. This course certainly delivered in this area. I found it empowering to learn about the highly detailed landscape of real estate capital in such a unique location. I am no longer intimidated by high finance as it relates to real estate, and I found Hong Kong as a very inspiring destination because I could actually feel the economic might of growth, progress and globalization.
I am truly glad I decided to go on this trip as part of my MSRE experience. I am deeply grateful to the Ahler’s Center for organizing it. I extend my sincerest gratitude for all the help and support. Thank you.
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This sounds like a great experience. I have always wanted to go to Hong Kong myself, but never have had a good reason. A study of real estate might be just the excuse I need. Unfortunately I am in the same boat you used to be in. That is ignorant of the investment capital structure. Is there anything you would recommend me reading to get the basics down?