The Marshall School's Program in Real Estate

Real estate has been taught at the undergraduate and MBA level at USC's Marshall School of Business since the 1950s and '60s. USC was where many of Southern California's industry professionals had their first exposure to the industry. The Program has always prided itself in mixing theory and practice in the classroom so as to expose students to the fundamentals while at the same time providing insight into day-to-day industry practice.

The last decade, however, has seen a dramatic change in the industry, and USC's Program in Real Estate continues to evolve to reflect academia's perspective on the industry as well as the industry's need for managers with knowledge of the industry and critical underlying principles. For example, during the early part of decade, a course was created that focused totally on distressed real estate and mortgages. This material had, to our knowledge, never been the subject of any real estate finance course in any business school in the United States. The work-out process involves expertise in real estate law (often both transactional and entitlement law), real estate market analysis, construction and real estate finance as well as bankruptcy law and contracts. A series of cases reflecting different types of distressed situations were developed to facilitate the teaching of this material. Virtually no existing cases (Harvard, Darden or Stanford) included the richness that was ultimately part of these cases. For many of our students, learning about real estate development had provided the capstone experience in the program. During the early '90s, exploring how to resolve problems with distressed real estate provided the capstone experience and propelled many of our graduates into careers in the area.

As the market evolved, cases dealing with equity REITs, mortgage REITs, real estate securities investment advisement and commercial mortgage-backed securities have been included in the class, which has now evolved into an advanced real estate finance class. To reflect the increasing role of public markets in the real estate industry, it is likely that that course will begin to focus more on investment in real estate equity (specifically, equity REITs), and another course will be developed that focuses on public investment in real estate debt, specifically, mortgage-backed securities, commercial mortgage-backed securities and conduits. However, since studying distressed real estate provides great insight into the kinds of problems that can arise during the business cycle, cases dealing with distressed real estate will not be dropped from the curriculum.

In our degree program offerings, the goal is to build on the core material in finance, accounting, marketing, strategy, economics and operations.

In executive education, since 1993, USC's Marshall School of Business has been home to MPIRE, the Minority Program in Real Estate, a two-week in residence executive program for professionals having an undergraduate degree and significant real estate experience in the for-profit, non-profit or public sectors. During five years, the program has graduated over 120 professionals, many of whom have gone on to develop affordable housing, consult to community based organizations, pursue further graduate business education, assemble financing packages for community development projects and develop commercial projects. This program is unique in that it provides executive education, industry contacts, access and networking opportunities for professionals with a commitment to maintaining and building many neighborhoods including those in our inner city.