Miscellaneous professional associations
"Feasibility analysis - the father of appraisal", Lambda Alpha presentation, March 19, 1976; Includes both the outline and transcriptions of the talk, pp. -
Lambda Alpha Presentation Feasibility Analysis - The Father of Appraisal Friday, March 19, 1976 i. Introduction A. Scholars, gentlemen, ladies...and mortgage bankers B. Appreciation for $500 grant which began cash flow modeling at the U. of Wis. C. Typical professor - attendance Is lousy unless he is promised the opportunity to dominate the conversation. Ii. The topic title was suggested by the Chicago statesman - Larry Cleland who thought "Feasibility, the Father of Appraisal" had a loftier and more academic tone than my suggestion ' "Appraisal, a Bastardized offspring of Feasibility" whose maternal lineage walked the streets of the financial district during the depression. A. By way of setting up an "I told you so" at the U. of W4is. we have been building our program on a number of basic definitions or axioms: I. Real estate Is artificially delineated units of space-time 2. A real estate enterprise Is any systematic conversion of space- time to money-time or vice versa by a cash cycle enterprise that Includes consumers of space-time, the public infrastructure on which real estate depends, and the private sector of space production management. 3. A cash cycle enterprise depends on a forecast of assumptions about future receipts and outlays. 4. All forecasts are subject to error and risk, both business and philanthropic is the variance between proforma expectations and historical accounting realizations. 5. Enterprise management Involves assumptions of a scenario and then control of variance and the execution of the program. The primary control on variance is expertise - entrepreneurial skill. 6. Therefore, the real estate business is essentially a service Industry providing expertise in the management of cash cycle enterprises In the conversion of space-time to money-time. In the private sector or the public sector all the profit centers lie In the de livery of services. 7. A real estate project like a shopping center or an office building is attractive to private enterprises because each project is a captive buyer of services and can be profitable to the promoter even though the net income, or traditionally economic surplus is close to 0 if the developer is successful in laying off thle cost of unexpected variance on others.
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