You are required to present a professional report. However, this differs from professional valuation
reports as you are required to present annotated valuations that explain your assumptions, and contain a
critical analysis of comparables and reflective discussion of the methods and principles you are
applying. The report should contain:
a. A very brief description of the properties you are required to value.
b. A traditional valuation and DCF investment appraisal for the London property which assumes
that the investor plans to buy the property and sell after a holding period of 15 years. Your
appraisal must also account for 5.8% purchase costs and a further 2.5% for disposal costs at the
end of the holding period. Forecasts predict that suitable exit yields, post refurbishment, will be
around 5% for this submarket. You should also allow 5% of the market rent for rent review
costs on leases at every rent review (over and above annual management costs). In addition,
your client has asked you to allow for refurbishment of the property between December 2034
and 2035 which a building surveyor has estimated at a cost of £4,725,000 (estimated as
December 2035 prices). Please note that the space will be unusable during these works so you
cannot collect rent during this last year. You expect to sell the property immediately after the
completion of the refurbishment
Also, do not forget to include the car parking in your valuations and appraisals. These spaces
have value too. You estimate the two spaces attached to this property each has a market price of
£20,000 as at the valuation/appraisal date.
c. Valuations of the market values, as at 7
th December 2020, for the property interests your client
has asked you to value. These should be accompanied by a critical discussion of your
comparable evidence, assumptions and methods employed. When valuing the leasehold interest
at Unit 2 Cambuslang Way, your client has asked you to use a suitable Year’s Purchase formula
that makes adjustment for a 2% sinking fund and 21% rate of corporation taxation which the
current occupier is liable for. Remember, current practice tends to use a single Year’s Purchase
formula to value leaseholds but your client has expressly requested a dual rate Year’s Purchase
and allowance for taxation. When valuing the landlord’s and tenant’s interests in Premier Inn,
Glasgow assume the rent represents 60% of the Fair Maintainable Operating Profit.
Information
Part of this exercise involves you undertaking your own data collection and interpretation of market
evidence. Links to property companies are on the Real Estate Valuation and Appraisal Moodle pages
and in these corporate webpages you can search for suitable local market reports. You should also
undertake further information searches. This should include searching for recent transactions on
CoStar Suite, which should be accessed using the password emailed direct to you. You will be shown
how to use the CoStar database to search for comparable transactions at a CoStar workshop on
Wednesday 14
th October 2020.
Submission Arrangements
Real Estate Valuation and Appraisal
4
Your valuation report should be submitted no later than 12.00hrs on Monday 7th December 2020.
There is a two-part process for this submission which is as follows:
1. Run the main body of your report (excluding appendices) through Turnitin as draft and final
versions before the submission date. Guidance on using Turnitin can be found in the SPS
Common Room.
2. Upload a copy of your calculations which should form your appendices either as an excel
spreadsheet or pdf of your handwritten calculations to the “Assignment Appendices” facility in
the same section of moodle as the Turnitin facility.
Students should ensure that a course coversheet is completed and attached to the front of both copies.
The course coversheet can also be found in the SPS Common Room (Enrolment Key=’SPS’).
The late submission of coursework will be penalised. Assignments not submitted by the required
deadline, and without approved extensions, will be subject to a 2 points deduction for each working
day overdue, subject to a maximum of five working days. If an assignment has not been submitted
within five working days of the deadline, the student will be awarded zero (grade H).
Marking Criteria
Marks will be awarded for the assignment’s contents, conciseness, clarity and coherence of arguments
and the overall presentation. The report and valuations will contribute to 100% of your overall mark
for the course, and should be 2,500 words in length (excluding the calculations and data analysis in the
appendices which has to be submitted as a separate file) and references. The valuations in the main
body of the report should follow the standard format used in the course notes and be typed. It is
recommended that you include your workings in the appendices, which may either be hand written or
word processed but need to legible, so the markers can follow your calculations.
A penalty will be imposed on submissions that go above the 2,500 word limit. Submissions 10-14%
over 2,500 words will be subject to a 1 point deduction; 15-19% over a 2 points deduction; 20-24%
over a 3 points deduction and 25% or more will be awarded a fail (zero) and required to resubmit as a
second attempt. You should also note that while the appendices are not included in the word limit in
this assessment you are restricted to a maximum of 10 A4 sides. This should be more than enough
space for your tabled data and calculations so anyone who goes over the limited number of pages for
their appendices will receive a 2 points penalty deduction.
Your submission will be marked in accordance with the following criteria:
• Completion of the valuation and appraisal tasks. Remember, this is a valuation and appraisal
exercise testing your ability to apply the principles and methods developed in class so the bulk
of the marks will be allocated to examine how well you perform these tasks. These tasks
account for 55% of the marks which are disaggregated as follows:
o The St James Square dcf investment appraisal (20% of the marks);
o The St James Square traditional market valuation (10% of the marks);
o Valuation of a residential, hotel and Edinburgh office unit (5% of the marks for each
of these three tasks);
o Valuation of industrial heritable interest (6% of the marks); and
o Valuation of industrial tenant interest (4% of the marks).
• The quality and quantity of market evidence you present to determine the market rents and
yields you apply in your valuations, and the logic you apply when critically evaluating the
suitability of these transactions as comparable evidence (10%).
• Your critical assessment of the Central London investment opportunity, Downtown Manhattan
and Downtown Core Singaporean office markets comparisons and quality of advice you give
your client (15%).
• The structure of your report, the clarity of writing and expression, and the depth with which
you critically discuss the methods you are applying. You are also expected to make use of
market, academic and professional practice information to support your arguments (15%).
• The level of professionalism demonstrated by the presentation of your report (5%).
Real Estate Valuation and Appraisal
5
This submission is just before the Winter Break so every attempt will be made to have your
submissions marked and returned to you by Monday 11
th January, which is 3 term-time weeks after
you submit. The University will be closed from 18th December until 11th January 2021.
N.B. On no account should you approach any tenants, owners or surveyors for information
regarding your site investigations. Any requests for material must be channelled through Allison
Orr.
Further, there are mock real-life scenarios in this brief with some facts altered for the purposes
of this exercise. If you find information that contradicts the details in the brief then always
assume the brief is correct.

Financial Markets and COVID-19
The data set “financial_data_ps3.dta” contains daily information on the closing price of the S&P 500 stock,
gold, bitcoin, as well as the interest rate on the U.S. 10-year Treasury note since January 2015 to October
2020. These data were retrieved from Yahoo finance. The following table defines the variables in this data
set:
Variable Variable name in Stata Description
Date date Year-month-day
Time trend timetrend Numerical variable that goes from 1 to T
Closing price of S&P 500 stock sp500_close Closing price in US dollars
Closing price of gold gold_close Closing price in US dollars
Closing price of bitcoin bitcoin_close Closing price in US dollars
Interest rate on the U.S. 10-year
Treasury note
treasury_close Interest rate
Before you begin, however, please read through these important instructions:
• Be sure to write your name on this page! Please submit your assignment by Midnight (CA time)
Friday December 11th. (Note: You will lose a full grade point (e.g., from A- to B-) for turning in
your assignment one day late. No submissions will be accepted after Saturday December 12th.)
The submission process involves two steps, both of which are required to receive full credit for the
Problem Set:
o Part 1: Upload your Stata do-file to the Problem Set 3 Assignment on Canvas. You will
lose a full grade point if you do not submit the Stata do file.
o Part 2: Upload your PDF via Gradescope. If you have any questions about how to upload
via Gradescope, please consult this helpful page:
https://help.gradescope.com/article/ccbpppziu9-student-submit-work
• You are permitted to discuss the assignment with your classmates, but all estimation and writeup should be done independently. Assignments like this are designed for you to generate your
own ideas, and this should be reflected in your submitted work. We will be looking out for
evidence that each student is submitting their own work and not that of classmates.
J. Edward Taylor Fall 2020
• Enter your answers onto this document in the space provided. More than enough space is
provided, so do not worry about filling up the space! Focus more on the quality of your
responses than on the quantity of words used in the responses.
• You have a few options for how to enter your responses. This PDF is fillable, which means
you can type out your responses in the boxes provided. (Note: It is highly recommended that
you print your final document as a PDF file and read over your submission to make sure
everything is as you want it before uploading to Gradescope.) You can also handwrite your
responses on a printed copy of the document, scan that document as a PDF, and upload the
submission. Alternatively, you could handwrite answers using a tablet. If you choose to
handwrite your responses, be sure to keep your handwriting within the boxes provided for each
question. Answers outside of the boxes are liable to be missed by Gradescope, resulting in
unnecessary points lost.
• When typing out equations, you may use lower-case letters in parentheses instead of subscripts.
For example, Y(i) is accepted in place of . If you are handwriting your responses, please use
subscripts for full credit.
• In order to open “financial_data_ps3.dta”, go to “File – Open”, and locate your local drives
where this dtafile is saved.
o For Windows users, your local drives should be under “This PC” – “C on {your
computername}.”
o For Mac users, “This PC” – “[folder name] on [your computer name].” The folder is
theone which you set up first in “Preference – General tab” in Microsoft Remote
Desktop Appwhen you install Stata. You should move “financial_data_ps3.dta” to this
folder.
• All the Stata commands have useful documentation with examples. If you want to see these
documents, you can type “help [command name].”
o For example, if you type “help reg” in Stata, a new window will be open and provide
a detailed information on syntax, options, and examples for reg command.
J. Edward Taylor Fall 2020
1. [5 points] The S&P 500 is an index of stock prices for the largest corporations in America. It includes
all the FAANG (Facebook, Amazon, Apple, Netflix, Google) stocks, but it also includes “old economy”
stocks like United Airlines, Hilton Hotels, and Carnival Cruises. Estimate an OLS regression to predict
the S&P 500 price at close of each trading day, based on its close price the previous day and a time
trend. That is, use the model to capture basic dynamics that is Professor Taylor’s preferred starting
model (see ppt for CH 9). Report your results. Hint: before running the regression, make sure to declare
the data to be a time series by typing tsset timetrend in Stata.1
Variables Estimated
Coefficient
Standard Error t-statistic 95% Confidence Int

1. Visit the url link below:
https://www.federalreserve.gov/newsevents/testimony/powell20201201a.htm
and read the testimony of the Fed Chair Jeremy Powell given at the US
Congress on Dec 1, 2020 about the state of the economy and its policy
implication amid Covid-19 crisis.
Question: After reading the transcript of the testimony, briefly analyze the
highlights of the policy challenges he described and what policy strategies
the Fed would take continue the recovery if the economy while Covid-19
crisis is still on the rise.
Note: If the url does not show up, you may go to federalreserve.gov and click on
news and events then look for testimony for Dec 1, 2020. 5 Points
2) Suppose the CFO of an American corporation with surplus cash flow had $100 million
to invest last July 15 and the corporation did not believe it would need to utilize these funds
to retool or expand production capacity for 1 year. Suppose further that the interest rate on
1-year CD deposits in US banks was .5%, while the rate on 1 year CD deposits in England
(denominated in British Pounds) was 2% at the time. Suppose further that the exchange
rate at that time was $1.68 per British pound.
A) Suppose that now a year later the exchange rate is $1.55 per US pound. What
rate of return did the CFO earn on the investment in the British CD? (Note: a
specific numeric answer is required for full credit.) 4pts.
B) What must the CFO have expected about the value of the British pound in $
today to believe that investment in British CD’s was more profitable than
investment in US CD’s last July? 3pts
3) On March 15, 2020 the Federal Reserve’s open market committee (the FOMC) has
suddenly decided to lower the federal fund rate to zero and ¼ of 1% amid the Corona virus
outbreak. This is the lowest interest rate at virtually zero since similar measures they had
to take in 2010 to recover from 2008 Great Recession, Visit the url link below to read the
statement to answer the question followed.
https://www.federalreserve.gov/newsevents/pressreleases/monetary20200315a.htm
The conventional monetary policy approach for effective policy objectives to achieve full
employment by expanding the money supply aggressively during severe recession. Since
the US economy has been hit hard by Covid-19 pandemic, the economy suddenly dropped
from its best record of unemployment rate in 50 years to one of the worst conditions of
losing job over 3-4 millions per week in March and April 2020.
Question: After reading the transcript of the FOMC monetary policy statement about
this extraordinary effort to the economic rescue, briefly but clearly explain the
transmission mechanism how this lowest possible federal fund rate change would
positively impact the current declining economy and jobs. 4 pts
Hint: Please read relevant monetary policy actions and its effect in the textbook chapter to
take the right approach.
4. From your theoretical knowledge on the concept about the reserve requirement policy
of the Fed in bank deposit and money creation in bank’s lending process, read the transcript
in the url link below posted by the Federal Reserve on March 15, 2020. At the bottom of
the transcript, the Fed announced the reserve requirement to zero for all bank deposits, a
major departure from its years of unchanged policy on reserve requirement.
https://www.federalreserve.gov/newsevents/pressreleases/monetary20200315b.htm
Briefly explain the reason for reducing the reserve requirement to zero% and its
potential effect on macroeconomic fundamentals during this economic downturn
caused by COVID-19 pandemic.
4) Assume the recovery process of the current depressed economy is expected to start after
ending the Covid-19 crisis presumably late Fall of 2020. Under the conditions in short term
financial market crisis and the economic recession in coming summer and fall of 2020, the
Fed has expanded a massive easy lending program on April 9, 2020 under the statement
below:
The Federal Reserve on Thursday took additional actions to provide up to $2.3 trillion in
loans to support the economy. This funding will assist households and employers of all sizes
and bolster the ability of state and local governments to deliver critical services during the
coronavirus pandemic.
“Our country’s highest priority must be to address this public health crisis, providing care for
the ill and limiting the further spread of the virus,” said Federal Reserve Board Chair Jerome
H. Powell. “The Fed’s role is to provide as much relief and stability as we can during this
period of constrained economic activity, and our actions today will help ensure that the
eventual recovery is as vigorous as possible.”, the press release stated. The url link to read
the transcript is below:
https://www.federalreserve.gov/newsevents/pressreleases/monetary20200409a.htm
This policy measure is similar to the quantitative easing policy the Fed took during the
recovery process of 2008 Great recession.
Question 4A: From your knowledge on this topic from this course learning, briefly
but critically explain how this massive loan of $2.3 to support the financial institutions
and households of all sizes would help recover the economy without accelerating
inflation. Is the theory of the Phillips Curve (inflation-unemployment trade off ) you
have learned in this course relevant in this context? Why or why not? 4pts
Question 4B: What relatively untested policy tools will help the Fed deal with the
potential problem of printing so much money as soon as the pandemic crisis over?
Explain. 4pts.
(Hint: you may wish to look at www.federalreserve.gov then click monetary
policy…then Policy Normalization: principles and Plans). You may also read relevant
chapters in the textbook.
5) Since the outbreak of Covid-19 virus in the US in March 2020 and continuous fall in
crude oil price to its 1973 level, the stock markets in the Wall Street has shown an
unexpected level of ups and downs after several times of stock market crash (with almost
wiping out 2019-20 gains in equity market) until recently the stock price went up to record
in its history. In the process, the value of the $ has also shown a continuous decline in Fall
2020 against the Yuan (Renminbi), euro, yen and many other major currencies. However,
in the first quarter of 2021, if the economy rebounds, the stock market prices are expected
to rise at a very high rate of growth.
5A. Given the expected rebound of the US economy, do you think US policy
makers would prefer to see the $ rise in value, decline in value or stay at its current
value? Discuss the advantages and disadvantages to the US economy at that time
of a stronger vs. a weaker $. Frame your answer in terms of the current Aggregate
Demand and Aggregate Supply situation of the US economy. 4pts
5B. Draw an AS/AD diagram to illustrate your answers for Question A) above.
Clearly label axes and the current position of AS & AD relative to full employment
RGDP….also indicate any shifts that would occur if the exchange rate of the $
rose sharply against other major currencies 4pts.
6) Each year since winning control of the House of Representatives in the 2010 election,
Conservative wing of Republicans have argued that we need to immediately initiate sharp
reductions in government spending and entitlement programs and rapidly move towards a
balanced budget, (although they have never actually produced a budget proposal in which
tax revenues would match government spending plus entitlement transfers). Many
Democrats, while arguing that tax rate increases on high income earners need to be part of
the any deficit reduction program, have agreed that we need to initiate budget deficit
reduction now. However, under the current Pandemic Crisis with $2.2 Trillion stimulus
programs and about $500 billion additional subsidy to affected small business owners plus
existing Trump Tax policy implemented in 2018 was just the reverse of what democratic
party views on taxes. Citizens for Tax Justice (CTJ) have made an estimate of how much
these tax reform approved by the GOP led Congress would impact the existing budget
deficit crisis already. According to their estimate, this reform would yield tax revenues of
only $1.1 trillion. The Office of the Management and Budget (OMB) estimated that the
federal government would raise an estimated $2.5 trillion and spend $5 trillion in 2018 and
more in 2019. Another estimate by independent research organizations and government
agencies predict that the federal budget deficit might increase by $1 trillion in 2018-2019
budget year. Adding the burden of stimulus package $2.7 trillion already disbursed in
2020, would result which of the following outcomes?
A) What is the argument against attempting to balance the Federal Government
budget rapidly at the present time via either deep cuts in Federal Government
spending or sharp increases in federal income tax rates? 4pts
B) Does this argument imply that skyrocketing budget deficits don’t matter in the
long run? If not, why might the impact of large deficits predicted in the long run
under current tax and spending programs be different than the impact tod

1. Business Requirements 1.1. Background 1.2. Business Opportunity 1.3. Business Objectives and Success Criteria 1.4. Customer or Market Needs 1.5. Business Risks 2. Vision of the Solution development life cycle (WHAT IS THE LIFECYCLE OF YOUR PROJECT?). The vision should not include detailed functional requirements or project planning information.> 2.1. Vision Statement 2.2. Major Features 2.3. Assumptions and Dependencies 3. Scope and Limitations 3.1. Scope of Initial Release 3.2. Scope of Subsequent Releases 3.3. Limitations and Exclusions 5 Proof of Concept for 4. Business Context 4.1. Stakeholder Profiles 4.3. Operating Environment ● Can the users tolerate service interruptions or is continuous access to the system critical for the operation of their business? ● What access security controls and data protection requirements are needed?