CCIM case studies
CCIM · Put your knowledge to work in context.
The CCIM Comprehensive Exam is the capstone assessment on the path to the CCIM Designation, the credential conferred by The CCIM Institute and signified by the CCIM Pin - which the Institute describes as real estate's most coveted credential. It is built for working commercial real estate professionals rather than newcomers: the Institute reports that designees average 22 years of commercial real estate experience, and more than 9,000 individuals currently hold the Designation while another 4,000 are in pursuit. The CCIM case studies are 5 cases and about 3,843 words.
1Cash-Out Refinance With a Razor-Thin DSCR Covenant
An owner is weighing a cash-out refinance of a 48-unit apartment building whose NOI is 412,000 and trending flat. The existing loan carries a 3,100,000 balance at 4.25% with annual debt service of 248,000; the lender quoted 140,000 of defeasance to retire it early.
613 words, about 3 min2Speculative Flex Building Against a Supply Wave
A sponsor is underwriting a 120,000 SF speculative flex building on a 24-month construction timeline in a submarket with 6,200,000 SF of existing inventory and 8.2% vacancy. Net absorption was 210,000 SF, 245,000 SF and 130,000 SF over the last three years.
656 words, about 3 min3Lease Versus Own for a 10-Year Occupancy
An engineering firm needs 40,000 SF for at least 10 years. Option A is a lease of 40,000 SF at 22.00/SF NNN with 3% annual escalations, a 10-year term, four months of free rent and a 35/SF tenant improvement allowance from the landlord.
822 words, about 4 min4Value-Add Exit Timing and the IRR Trap
A private investor is underwriting a 120-unit apartment complex priced at 16,500,000 - a 6.36% year-1 cap on NOI of 1,050,000. The business plan: 65% LTV interest-only debt at 6.25%, a 1,200,000 interior renovation in year one funded from equity, and NOI of 1,180,000, 1,290,000, 1,380,000 and 1,450,000 in years two through five.
870 words, about 4 min5Sale-Leaseback or Refinance for an Owner-Occupant
A 60,000 SF owner-occupied industrial building appraises at 9,000,000 on a 6.75% cap rate; the owner's imputed NOI is 607,500. The owner occupies 45,000 SF and leaves 15,000 SF vacant; market rent is 13.50/SF NNN and that space could be leased within about a year.
882 words, about 4 min