Center for Real Estate and Finance 2021-2022 Year In Review Mission Statement The mission of The Cornell Center for Real Estate and Finance (“CREF”) is to accomplish three primary goals: First, CREF will act as the nexus between the practical real estate industry and the broad Cornell University community (faculty, students and alumni). In this context, CREF will leverage the engagement of practicing real estate profession- als to enhance the educational experience of Cornell’s graduate and undergraduate students studying real estate and to inform our Real Estate Faculty regarding industry trends to better prepare them as they design and teach courses. Second, CREF will be the leading purveyor of thought leadership on the topics of real estate and finance and to disseminate that thought leadership to the academic and practitioner real estate community. Finally, CREF will advance the reputation of Cornell University, The SC Johnson College of Business and the Cornell Nolan School of Hotel Administration as an educational and thought-leadership force within the real estate community both domestically and internationally. Table of Contents Leadership Research and Insights Internships and Student Page 2 Page 9 Engagement Page 13 Events Diversity and Inclusion Academic Engagement Page 17 Page 21 Page 22 Member Benefits Thank You Page 24 Page 27 1 Leadership From the Director As I reflect on the past year my thoughts go first to all of our board members. Over the past year we have been fortunate to add many new board members and to have the vast majority of the rest of our board continue their support. The resources they all provide through their guidance, and physical and financial support are so very much appreciated. I am looking forward to working with all of our board members, new and continuing, over the coming academic year. This past year we were fortunate enough to provide support for students going on treks, Steven Carvell consulting activities, seminars, and a variety of D&I initiatives. We provided support to our Professor of Finance faculty through board member guidance as liaisons, and by providing financial support Arthur Adler ‘78 and Karen for database purchases. We provided support to the academic mission of CREF and Cornell through our support of various real estate academic conferences. CREF also ran the 13th Newman Adler ‘78 Director Annual International Real Estate Case Competition and the 7th Annual Titans of Real Estate CREF here on campus. We also co-sponsored the 7th Annual ICSC Case Competition, the Philip Payton HBCU Case Competition, as well as the CREC Conference in NYC. Looking ahead, we will be holding our first board meeting in many years on our Ithaca campus. We have a busy day planned. Aside from our board meeting where Dean Andrew Karolyi will visit with us and discuss the new Rubacha Department of Real Estate; we will host a round table where we will discuss the significant challenges facing hotel ownership and management, as well as a meet and greet with students. I have invited our faculty to attend the board meeting and the roundtable. We will, of course, have time to gather informally at dinner the night before the board meeting, during lunch, and at a reception in the late afternoon/early evening where students from our six real estate clubs will join us to discuss real estate education here at Cornell and how CREF is providing support for their various initiatives. As we move forward in the 2023-24 academic year, we have many activities planned. We expect to expand our support of students from each of the real estate clubs, continue the RE Elizabeth Cunningham Faculty Liaison Program as well as our support for the array of other activities both here on Program Manager campus and in NYC. I also will be at ALIS this year and hope to see many of our board CREF members at a planned breakfast meeting. Finally, I am happy to report that, over the summer, Dean Walsh and the college leadership extended me a second three-year term. I am grateful to be able to provide leadership for CREF through June 2026 and hope to continue to expand our support of all aspects of Real Estate at the Nolan School, the Johnson College of Business, and Cornell University. 2 Our Board As of June 2022 Arthur Adler ‘78 Jun Ahn, MSP RE ‘00 Bob Alter ‘73 Richard Baker ‘88 Chairman, Cornell Center for CEO - Core Value & President Governor and Real Estate and Finance Managing Director of the Seaview Investors Chief Executive Officer President, Adler Hotel Real Estate Division Hudson’s Bay Company Advisors LLC YIDO (HBC) Michael Barnello ‘87 Kenneth M. Blatt ‘81 Robert Buccini ‘90 (A&S) Marty Burger, P ‘17 & ‘20 Former President and Chief Principal Co-president Chief Executive Officer Executive Officer CPG Real Estate The Buccini/Pollin Group Silverstein Properties LaSalle Hotel Properties Adam Burinescu ‘03 (CALS) Rodney Clough ‘94 Howard Cohen ‘89 Kevin Davis Managing Director Managing Partner Chief Executive Officer Senior Managing Director - Centerbridge Partners HVS Atlantic | Pacific Companies Hotels & Hospitality Group3 JLL Our Board Navin Dimond, P ‘14 & ‘19 Adam Docks Joel Eisemann, MPS RE ‘80 Habib Enayetullah President and Partner and Firmwide Chief Development Officer, Senior Vice President for Chief Executive Officer Co-Chair, Hotels & Leisure The Americas Real Estate and Asset Stonebridge Companies Industry Group InterContinental Hotels Group Management Perkins Coie LLP (IHG) Hilton Worldwide Russell Galbut ‘74 Nolan Hecht ‘97 Kate Henriksen ‘96 Faron A. Hill, MBA ‘20 Managing Principal Senior Managing Director Senior Vice President President Crescent Heights Square Mile Capital Investment and Portfolio Peregrine Oak Analysis RLJ Lodging Trust Kenneth Himmel ‘70 David Hirschberg Jeffrey Horwitz David Israel ‘09 President and Chief Execu- Managing Director Partner Senior Vice President, CHA 4tive Officer - Related Urban H.I.G. Realty Partners Proskauer hotelAVE Co-Managing Partner - Gulf Related Our Board Dana Jacobsohn ‘92 David Jubitz ‘04 Alan Kanders ‘87 Rob Kline ‘84 Senior Vice President, Global Chief Investment Officer Principal Chief Executive Officer and Mixed-Use Development Clearview Hotel Capital Three Wall Capital Co-founder Marriott International, Inc. The Chartres Lodging Group Jason Lee ‘95 Michael Lipson Terence Loh ‘97 William Lovejoy Managing Director, Chief In- Chairman of the Board and Senior Vice President President and Chief vestment Officer - Asia and Chief Executive Officer CDIB Capital Executive Officer Senior Portfolio Manager Access Point Financial, LLC Masterworks Development AEW Co., LLC Neil Luthra Jay Mantz, P ‘21 Alfonso Munk ‘96 Chip Ohlsson Principal President, New York Chief Investment Officer, Executive Vice President and Highgate Rialto Americas Chief Development Officer5, Hines North America Wyndham Hotel Group Our Board Mark Owens ‘00 Daniel Peek ‘92 David Pollin ‘90 Ray Potter ‘87 (CALS), Executive Vice President and President, Hotel Group Co-founder and President MBA ‘92 Head of Hospitality Capital HWE The Buccini/Pollin Group Founder and Managing Markets Partner CBRE R3 Funding Michael Profenius, Rachel Roginsky ‘79 David Rosenberg, Chuck Rosenzweig ‘85 (ILR), P ‘15 & ‘17 Principal P ‘11, ‘13 & ‘19 JD ‘88 Chief Operating Officer Pinnacle Advisory Group Chief Executive Officer Founder and Managing Partner Northwood Investors Sawyer Realty Holdings Criterion Real Estate Capital Ben Rowe ‘96 Paul Rubacha ‘72 (CALS), Richard Russo ‘02 John Ryan Founder and MBA ‘73 Principal Founder and Chief 6 Managing Partner Principal Highgate Executive Officer KHP Capital Partners Ashley Capital Metro Development Group Our Board C. Patrick Scholes ‘94 Nirav Shah, MMH ‘05 Matthew Shore ‘00 Seth Singerman ‘99 Managing Director, Lodging Regional Vice President, Chief Investment Officer Managing Partner and Leisure Equity Research Development DRA Advisor Singerman Real Estate Truist Securities Hyatt (“SRE”) Justin Smith ’00 Jackie Soffer P ’20 Robert Springer ‘99 Richard Stockton ‘92 President Chairman & Executive Vice President - Founder and Chief Executive Presitge Hospitality Group Chief Executive Officer Chief Investment Officer Officer Turnberry Sunstone Hotel Investors Braemar Hotels & Resorts Andrew Taffet ‘05 (A&S) Alan Tantleff ‘87 Dan Unger ‘97 Eva Wassermann Chief Investment Officer and Senior Managing Director Chief Development Officer Managing Director Head of Asset Management FTI Consulting Tishman GEM Realty Capital, Inc. 7 The Carrington Companies, LLC Our Board Shai Zelering ‘01 Managing Partner Brookfield Real Estate Group 8 Research and Insights CREF Research: Focused on the Industry The Center for Real Estate and Finance at the Cornell Nolan School of Hotel Administration publishes a series of four types of online research studies: reports, tools, roundtable highlights, and indices. The publications are valu- able for their broad appeal and practical implications for hospitality and service industry executives, managers, operators, and consultants. All hospitality publications are available at no cost and can be accessed through the Cornell Nolan School of Hotel Administration’s digital repository, Cornell eCommons. → → 9 → → → → Research and Insights Research Published FY 2021-2022 The full catalogue and a searchable database of over a decade of CREF reports, including industry tools and roundtable highlights, can be found in the CREF repository of the Cornell Nolan School of Hotel Administration’s Scholarly eCommons. Second Quarter 2021: Are We There Yet? Co-authored by Crocker H. Liu, Robert A. Beck Professor of Hospitality Financial Management United States hotel prices have rebounded above their statistical lower bound in all regions except the Mountain states, signaling a return toward their pre-pandemic level—although we are not quite there yet. Prices of hotels in gateway cities rose 6 percent, while hotels in non-gateway cities climbed almost 7 percent on average this quarter. Read More The Wall Street Stampede: Exit as Governance with Interacting Blockholders Co-authored by Dragana Cvijanovic, RAssociate Professor The growth of the asset management industry has made it common- place for firms to have multiple institutional blockholders. In such firms, the strength of governance via exit depends on how blockholders react to each other’s exit. We present a model to show that open-ended institu- tional investors such as mutual funds react strongly to an informed block- 10 holder’s exit, Read More Research and Insights Real Estate: Private Equity Investment in Shanghai Co-Authored by Peng Liu, Associate Professor Singapore Tourism Board Distinguished Professor in Asian Hospitality Management and Terence Loh ‘97, Senior Vice President, CDIB Capital In this case study, you are a consultant engaged to assess whether to in- vest in Project Innov Star, a Class A office project in Zhangjiang Shanghai, which currently is stalled. The hold up, and thus the opportunity to invest, arises due to a difference of opinion between the two partners. The ma- jority investor (80%) seeks to sell its share, while the 20-percent minority investor would be willing to complete construction with a new partner, or might be open to selling the entire project. Read More Pole Vaulting to New High Co-authored by Crocker H. Liu, Robert A. Beck Professor of Hospitality Financial Management Hotel prices continued to gain ground during the recent quarter, regain- ing losses incurred during the pandemic. Prices in all regions are reverting to their long-term average, with hotels in the Pacific and South Atlantic regions rising above their standardized average. Hotels in both gateway and non-gateway cities continue to exhibit positive performance, al- though hotels in the gateway cities have posted greater gains. Read More Put Credit Rating Agency’s Money Where Its Mouth Is Co-authored by Alexei Tchistyi, Associate Professor We derive an optimal compensation contract that incentivizes a credit rating agency (CRA) to exert effort and issue unbiased ratings. The con- tract rewards CRA when its credit rating is matched by the subsequent bond performance and penalizes it otherwise. The optimal contract can be implemented by giving CRA options to buy bonds or credit default swaps. In a competitive environment, the contract is part of a procure- ment auction. Our empirical findings show that the credit rating industry remains problematic. Read More 11 Research and Insights Beware the Ides of March Co-authored by Crocker H. Liu, Robert A. Beck Professor of Hospitality Financial Management The price of large hotels fell by .25 percent, while that of smaller hotels increased 3.3 percent this quarter. On a regional basis, the MidAtlan- tic had the best quarterly gains, with the Pacific region also doing well, while the Midwest suffered price declines. Hotels in both gateway and non-gateway cities continue to post positive performance, with greater gains for hotels in non-gateway cities. Read More Restaurants that survived the pandemic are now threatened by inflation Hosted by Rachel Martin; NPR They managed to survive the worst of the pandemic. But now some restaurants fear it may be inflation that does them in. Restaurants are facing sky-high food prices and higher costs for labor, gas and rent. NPR’s Tovia Smith has more. STEVE CARVELL: Because they’re larger, they have better supply chains, more consistent costs on their inputs. So, you know, it gives them more leeway to maintain a profit margin. Read More Crypto-backed mortgages let HODLers become homeowners Authored by Ashwin Rodrigues; Morning Brew As the NFT market cools down, the housing market continues to boil. The next step for crypto believers could be real estate. This is about real real estate, not just plots of land in the metaverse. New lending compa- nies are looking for customers who want to pledge their digital currency toward a mortgage. Over a billion dollars of funding has already been poured into startups offering crypto-backed mortgages, including Ledn, 12 which claims to offer “the world’s first bitcoin mortgage”; Read More Internships and Student Engagement Sponsored by the Centers & Institutes in the Cornell Nolan School of Hotel Administration, the C&I Internship Pro- gram provides students opportunities to gain practical experience in innovation, entrepreneurship, healthcare, food & beverage management, research, real estate finance, labor and employment relations, and other hospitali- ty focus areas. If you are a current student or a participating C&I advisory board member company, visit the Centers & Institutes home page to apply for or submit available internship opportunities. Internship Duration Intern Compensation Intern Reporting 2 weeks to 12 weeks Competative Salary Entrepreneur or Senior Executive 13 Internships Student Application Process Apply Via Handshake Offer Browse Interview Internships Review/Approve Internship Posting Offer Submit Internships Interview Contact Online Applicants CREF Company Participation 14 Process Student Engagement Fall 2021 NYC Trek November 1, 2021 New York City In November of 2021, CREF helped coordinate a student trek with 14 members of the Cornell Real Estate Club. Students spent the day touring SaksWorks and were graciously hosted by CREF board member, Richard Baker, Governor and Chief Executive Officer, Hudson’s Bay Company. 2022 UNC Real Estate Development Challenge February 17-18, 2022 University of North Carolina In February of 2022, CREF helped fund travel for a team of graduate stu- dents from the Cornell Baker Program in Real Estate to travel to UNC to compete in their annual Real Estate Development Challenge. Spring 2022 NYC Trek April 28-29, 2022 New York City In April of 2022, CREF helped coordinate a second student trek with 20 members of the Cornell Real Estate Club. Students spent the night in New York and met with several industry practitioners from Sculptor, Hodges Ward Elliot, Goldman Sachs RE, and Rialto Capital. 15 Student Real Esate Clubs Associate Real Estate Council Association of Cornell The Associate Real Estate Cornell PropTech Club Women in Real Estate Council (AREC) Undergraduate students (ACWIRE) Graduate students Graduate women in real estate Cornell Real Estate Club Diversity and Inclusion in The Philip Payton Society Undergraduate students Real Estate (DAIRE) for Minority Real Estate Undergraduate students Professionals Graduate and Undergraduate students 16 Events For FY 2021-2022 Industry Engagement Competitions 2 Engagement 2 Real Estate Case Events Competitions Board Meetings Webinars 2 Board Meetings 1 Webinar 17 Events 39th Annual Cornell Real Estate Conference October 21 & 28, November 2 & 4, 2021 Virtual Traditionally held in-person, this year’s conference was held over four days as a webinar series discussing real estate in a world of disruption and un- certainty. Cornell International Real Estate Case Competition November 12, 2021 Virtual Sonic the Hedgfund, representing Cornell University, took third place at the 13th Annual Cornell International Real Estate Case Competition on November 6, 2020. First place went to Blue Water Advisors, representing the Sauder School of Business, University of British Columbia, and second place to KS Capital, representing the Chinese University of Hong Kong. The competition was held online and the finals were Livestreamed with the help of eCornell. Cornell University was represented by: Sharon Chen, Abhi Goyal, Alex Iz- volsky, Angela Lu, Jai Patel, and Emily Wu. CREF Fall Advisory Board Meeting November 19, 2021 New York City, NY The board held its annual Fall Advisory Board Meeting in-person. The meeting was hosted by CREF board member company Hodges Ward Elliott with special thanks to board member Daniel Peek ‘92, chief operating officer, HWE. 18 Events The View for 2022 Insights and Expectations for the U.S. Hotel Industry December 17, 2021 Webinar After 20 months of upheaval, the U.S. hotel industry is eager to regain lost ground. Leisure travel has rebounded, COVID-19 vaccination rates are up, and unemployment is declining, yet corporate and group travel remain well below 2019’s levels, and supply chain issues and inflation fears are real. Could 2022 be a turning point? Watch here 7th Annual Titans Of Real Estate May 5, 2022 Ithaca, NY The 2022 Titans of Real Estate event, held together with the Cornell Baker Program in Real Estate’s Distinguished Speaker Series, took place on Cor- nell's Ithaca campus and featured an interview with Richard Baker ’88, governor and executive chairman, Hudson’s Bay Company, and Jack Bak- er ’19, chief operating officer, National Realty & Development Corp. They were interviewed by the Academic Director for the Center for Real Estate and Finance, Steve Carvell, professor of finance in the Cornell SC Johnson College of Business. Cornell/ICSC Retail Real Estate Case Competition May 22-23, 2022 Las Vegas, NV Congratulations to 1st place winner University of British Columbia – Saud- er and 2nd place Cornell University! The Retail Real Estate Case Competition is held annually and this year took place during ICSC 2022 LAS VEGAS. The competition was in-person on May 22-23, 2022. This invitation-only competition welcomed under- graduate teams comprised of four students each from the top university real estate programs. 19 Events CREF Spring Advisory Board Meeting June 7, 2022 New York City, NY The board held its annual Spring Advisory Board Meeting in-person. The meeting was hosted by CREF board member company Centerbridge Partners with special thanks to board member Adam Burinescu ‘03 (CALS), managing director, Centerbridge Partners. 20 Diversity and Inclusion Initiatives This year, CREF was honored to work with Blackstone Properties for the second installment of an initiative to pro- vide funds for students of HBCU’s to register for and receive a certificate in real estate from eCornell. This year’s participating HBCUs: • Clark Atlanta University • Howard University • Hampton University • Morehouse • Morgan State University • North Carolina A&T University • Spelman College • Tuskegee University We were thrilled to host the winners of the Philip Payton Society Real Estate Case Competition at the Titans of Real Estate on May 5th, 2022! Yentell James and Mikayla McDaniel joined us from North Carolina A&T University, and were recognized at the reception following our speaking event. The team also included Faheema Fabre and Jac- quoia Hunter. Presenting the check were Ali Daye ‘MRE ’19 (Baker), founder of the Philip Payton Society; Amanyi Richardson MRE ’22 (Baker), president, Philip Payton Society, Christopher Browne MRE ’23 (Baker), treasurer, Philip Payton Society, Victor Younger, director of diversity and inclusion, Cornell Nolan School of Hotel Administration; Richard Baker ’88, governor & executive chairman, Hudson’s Bay Company; Steven Carvell, professor and CREF academic director; & Kate Walsh ’90, dean, Cornell Nolan School. 21 Academic Engagement Faculty Steve Carvell Dragana Cvijanovic Sean Flynn Adam Klausner Professor Associate Professor Assistant Professor Senior Lecturer Academic Director - (CREF) Daniel Lebret Crocker H. Liu Peng Liu Daniel Quan Senior Lecturer Robert A. Beck Professor of Associate Professor Robert C. Baker Professor in Hospitality Financial Real Estate Management Alexei Tchistyi Maxence Valentin Associate Professor Visiting Assistant Professor 22 Academic Engagement 2021-2022 Class Offerings Fall 2021 • HADM 3210 Principles of Hospitality Real Estate • HADM 4200 Principles of Real Estate • HADM 4230 Hospitality Real Estate Finance • HADM 6200 Principles of Real Estate • HADM 6210 Hospitality Real Estate Finance • HADM 6225 Hospitality Strategic Financial Management • HADM 6230 Real Estate Statistical Modeling • HADM 6990 Graduate Special Studies Project I • HADM 9981 Hospitality Graduate Research Seminar Spring 2022 • HADM 3210 Principles of Hospitality Real Estate • HADM 4200 Principles of Real Estate • HADM 4205 Real Estate Financial Modeling • HADM 4255 Real Estate Development • HADM 4280 Real Estate Finance and Investments • HADM 4970 Distinction in Research Course I • HADM 6200 Principles of Real Estate • HADM 6205 Real Estate Financial Modeling • HADM 6255 Real Estate Development • HADM 6280 Real Estate Finance and Investments • HADM 7950 MMH Master Class 23 Membership Benefits All of our Centers and Institutes at the Cornell Nolan School of Hotel Management are privately fund- ed by our generous board member companies. These memberships allow us to continue to provide the very best in academic courses, industry research, and student development opportunities. The Center for Real Estate and Finance offers a variety of ways for individuals and firms to become engaged with center activities. Through event and program sponsorships, corporate memberships, and giving opportunities, the center is a link between engaged supporters and their preferred constituents. Become a Center for Real Estate and Finance Corporate Member 24 Membership Benefits Corporate Membership Benefits CREF Corporate Member benefits include: • Advisory board seat in the Center for Real Es- tate and Finance (CREF). The advisory board, composed of senior-level leaders in the industry, meets twice annually. • Recognition as a CREF advisory board member on the CREF website, including advisory board member’s corporate logo, a link to company’s website, and the advisory board member’s personal bio and photo. • Opportunity to participate as a panelist at CREF events. • Advisory board member’s company or name listed as a CREF advisory board member on all press releases that announce CREF publications and other CREF news. • Advisory board member’s company logo or name (with a web link) featured on a rotating basis in the CREF newsletter, which circulates to industry executives, practitioners, and educators worldwide. • Opportunity to be considered as speaker at other conferences and seminars where the CREF Academic Director is creating a panel. • Opportunity to mentor and interact with graduate and undergraduate students with an interest in real estate and finance. • Invitations to select CREF, Cornell Nolan School of Hotel Administration, and SC Johnson College of Business industry events. • Ability to share your company’s internship and employment opportunities with undergraduate and graduate students 25 Membership Benefits Giving Opportunities Naming Opportunities • Naming the center: $10,000,000 • Naming competitions: $750,000 Membership • Advisory board membership(pending approv- al): $10,000/year (suggested three-year com- mitment) Support the Educational Mission • Roundtables: $2,500 – $10,000/event • Student travel: $1,000 – $15,000/year • Speaker series: $5,000/year Experiential Learning • Cornell International Real Estate Case Compe- tition: $7,500 – $25,000 • Titans of Real Estate: $5,000 – $25,000/year • Networking programs and events: $2,500/ event 26 Thank You To Our Members and Affiliates 27 Thank You To Our Members and Affiliates 28 Center for Real Estate and Finance Cornell University Cornell Peter and Stephanie Nolan School of Hotel Administration 149B Statler Hall Ithaca, NY 14853 Phone: 607.255.8373 cref@sha.cornell.edu cref.cornell.edu