Private Real Estate Investments errata in First Edition

Page 21

“Businesses that can easily move out of an oppressive jurisdiction restrain policymakers who might otherwise enact ruinous legislation.”

Page 28, Figure 2-2 the legend is reversed. It should be

Page 29, Figure 2-3 has a similar problem. In addition to correcting the graphic as you see here, the text below should be slightly changed to reflect the correction in the graphic

Figure 2-3 shows how a decrease in γ moves the marginal benefit function in toward the origin and an increase in β moves the marginal cost function in and up in a northwest direction (dotted lines represent the new functions). Note that both movements are away from optimality.

Page 42, Figure 3-2 has a superfluous “%” sign after the 1.43 Debt Coverage Ratio (DCR). The figure should be

Page 48, Figure 3-4 reflect some numbers that are unexplained (89.01, 89.02, etc). These are census tract numbers used to identify the areas on the map and have no other significance.

Page 56, et seq. The section intended to introduce ideas about non-normality uses as an example expense and vacancy rates (evr) for several cities. The alert reader will immediately recognized that since evr data is, by definition, bounded strictly positive (0 < evr < 1), such data can never be normally distributed. This, while true, does not change the importance of critically examining data that might be normal to determine if in fact it is normal.

Page 90, Equation 4-15 is missing a critical minus sign in the exponent in the denominator. It should be:

 ( 4.15 )

Page 138 at the bottom has a graphic with the words “Coil Toss” that should be “Coin Toss”

Page 163, Table 7-4 and Page 164 Figure 7-1 describe the same result but have differences in the last digit on three of the numbers. This is due to rounding and can be safely ignored. The same is true for Table 7-8 and Figure 7-2 on Pages 165 and 166.

Page 161 at the bottom begins a sentence that ends on Page 163 that should read:

“In Table 7–6 we see that in dataEG1 these variables take on non-zero values.”

Page 199 has a sentence that should read:

“Returning to the property manager's problem, this time considering the vacancy factor by substituting mgt cr for g u in the original np function and substituting Equation (8-14) for cr, we construct a new net profit function, np3.”

Page 209 misreports the character who said “Neither a borrower nor a lender be” as Hamlet. It was Polonius in Hamlet (Act 1, Scene 3). This is doubly embarrassing in that not only did I know that Hamlet did not say that, I knew that Hamlet did not have a son. This is an example of working late at night when you are tired and trusting what you find on the internet when you can’t remember something!

Page 223 has a sentence that should read:

“This continues through the last "greater fool", the moment that interest rates rise, at which time the bubble deflates and the party is over.”

Page 226, Figure 9-6 should have “xdcr(i)” as the y-axis (vertical axis) label and in the caption. Placing i in parentheses indicates that xdcr is a function of i.

Page 229 has a comma in the wrong place which is corrected here:

“During the last expansion of a bubble, buyer expectations are maintained solely by low interest rates.”

Page 235, on the right plot in Figure 9-12 the y-axis says “lvt” and it should be “ltv” for “loan to value”