The vice-president of acquisitions for Canadian Real Estate Investment Trust (CREIT) was contemplating two investment opportunities confronting his business. CREIT had been very competitive lately in an effort to raise diversity and the size of its portfolio. One potential deal he was contemplating involved the purchase of a 161-unit apartment building in a Montreal suburb, while the other possible deal entailed was for a retail complex in a Chicago suburb. CREIT could review the properties and determine whether to proceed with either purchase because both the purchasing possibilities were under a period of due diligence.
The vice president has to present sufficiently thought out recommendations to the board of seniors at CREIT, he pondered on the level of attractiveness of each property; regardless of whether the individual markets warranted the price levels, if the various properties were consistent with CREIT's acquisitions strategy. The instance introduces real estate investment trusts and shows some common notions regarding the valuation of property assets, including discounted cash flow and comparable sales analysis.
Publication Date: 08/31/1999
This is just an excerpt. This case is about Finance
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