Chapter 9: Real Estate Management Flashcards
Appraisal of commercial property value for determining tax liability is most often based on the property’s:
A. Comparable property sale price
B. Land and structure construction costs
C. Ability to generate rental income
D. Purchase price adjusted for inflation and depreciation
C. Ability to generate rental income
The real estate function of facility management considers all of the following except:
A. Lease vs buy decisions
B. Major space consolidation projects
C. Worker ergonomics issues
D. Maximizing profits from sales
C. Worker ergonomics issues
The more rapidly market values are increasing and the closer an asset is to the end of its depreciation period, the greater the chances for a:
A. Tax deduction benefit
B. Substantial capital gain
C. Profitable leasing arrangement
D. Substantial loss of value
B. Substantial capital gain
An arrangement where a company uses its own capital to develop a project and then sells the completed project to a developer who then executes a lease with the same company is called a:
A. Gross lease
B. Triple net lease
C. Sale-leaseback
D. Build-to-suit
C. Sale-leaseback
The risk manager should review a lease before it is signed to ensure that it does not contain:
A. Unfavorable insurance requirements
B. Unfavorable or unnecessary lease clauses
C. Unreasonable obligations for damages
D. Exemptions for natural disasters
A. Unfavorable insurance requirements
A comprehensive document used to compare your corporate plans with each site’s/location’s ability to support those plans is a(n):
A. Inventory review
B. Facilities audit
C. Annual budget
D. PERT chart
A. Inventory review
A lease clause that is an advantage to the lesser and a disadvantage to the lessor is a(n):
A. Expense cap
B. Option right
C. Expense pass through
D. Rate adjustment
B. Option right
Which of the following should not be included in the inventory review of a property?
A. Whether the property is leased or owned
B. Demographic statistics
C. Political conditions of the local government
D. Past utilities
D. Past utilities
Making sure that the environment is suitable for real estate investment is highly dependent on which group?
A. Local government
B. The facilities management community
C. Nearby real estate investors
D. Property owners
A. Local government
The main downside of owning a custom-designed property is:
A. It is expensive
B. It is difficult to furnish
C. It is hard to sell
D. It can be difficult to navigate
C. It is hard to sell
Which of the following enables a corporation to assume ownership by using a developer to hold ownership until the project is complete and ready for occupancy?
A. Special-use property development
B. Triple-net lease
C. Outside-in build
D. Build-to-suit
D. Build-to-suit
One difference between ______________ is that the former requires the tenant to pay a lease cost that covers the landlord’s debt service and profit, while the latter allows the freedom to occupy or sell the property.
A. Ownership and gross lease
B. Ownership and build-to-suit
C. Triple-net lease and ownership
D. Gross lease and ownership
C. Triple-net lease and ownership
Which of the following would be considered an above-standard service?
A. Building access during nights, weekends, and holidays
B. Trash disposal
C. Security
D. Furniture moving or setting up conference rooms for meetings
D. Furniture moving or setting up conference rooms for meetings
Lease buyouts are dependent on all of the following factors except:
A. An economic benefit to the landlord
B. A tenant making the initial buyout offer
C. Annual CAM (common are maintenance) charges
D. Market conditions
C. Annual CAM (common area maintenance) charges
Which of the following is an environmental audit designed to protect?
A. The culture fit of the new tenants
B. New owners from issues with neighbors
C. The owner against health hazard liability
D. Properties that are not compliant
C. The owners against health hazard liability
