Master lease & leaseback of government owned real estate : a model for a fixed income investment product
Name
54755279-MIT.pdf
Description
Full printable version
Size
4.38 MB
Format
Adobe PDF
Checksum (MD5)
af141be6c974327924e69246116d2dae
Author(s)
Hutchinson, Jeffrey E. (Jeffrey Ernest), 1970-
Advisor(s)
David Geltner.
Alternative Title
Master lease and leaseback of government owned real estate
Date Issued
2003
Publisher
Massachusetts Institute of Technology
Abstract
Throughout the United States, significant taxpayer capital is unnecessarily tied up in the ownership of state and municipal government buildings. Today, multiple state and municipal governments face record budget deficits, and are struggling to find ways to raise revenues and decrease annual operating costs in order to close these budget gaps. At the same time, substantial amounts of investor capital from both public and institutional funds, as well as private investors, sits idle, as there is a lack of opportunity for safe, moderate-return long-term investments in today's markets. This thesis investigates the benefits and drawbacks to an investment structure, similar to the commonly used corporate sale-leaseback, that can be used to free capital that is tied up in existing government-owned real estate, while allowing governments to retain long-term ownership of these assets. It also presents the methodology for syndicating these investments into rate-able fixed income products, similar to municipal bonds or CMBS. These investments and the associated participation instruments create arbitrage opportunities for underwriters and syndicators of Government Lease Backed investments, and generate capital flows in the tens of billions of dollars. The models presented may be applied to federal, state and municipal government assets alike. However, this thesis focuses on the application of the models to assets owned by the State of California, as it currently has one of the most significant budget crises in the country, as well as the largest state-owned real estate portfolio.
Description
Thesis (S.M. in Real Estate Development)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning, 2003.
Includes bibliographical references (leaf 51).
Subjects
Urban Studies and Planning.
MIT Department
Massachusetts Institute of Technology. Department of Urban Studies and Planning
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