PowerPoint CH2 Flashcards

1
Q

What are projects with high market risks?

A

-Hotels and motels
-Restaurants and entertainment

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2
Q

Why do hotels have high market risk?

A

they are seasonal and occupancy is based on a nightly rate

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3
Q

Why do restaurants have a high market risk?

A

they are reliant on the surrounding area, jobs, and the market

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4
Q

What are projects with prospective major changes in the market?

A

Lease rollover for major tenants, major renovations

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5
Q

What is lease rollover?

A

When multiple leases end at the same time

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6
Q

What are some things that impact market risks?

A

Default risk, jobs, vintage, occupancy, location

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7
Q

What is the multiplier effect?

A

base income is re-spent, producing additional income

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8
Q

What makes a multiplier effect in a city greater?

A

-more isolated
-more diversified
-larger
-the base activity uses more local goods and services

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9
Q

Why might there be a leak in the economic base multiplier?

A

online shopping

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10
Q

slide 10

A

/

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11
Q

What are the ‘industry economies of scale’?

A

Efficiencies of production due to scale of local industry

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12
Q

What happens when there is a growth of an industry within a city?

A

it creates special resources and cost advantages for that industry

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13
Q

What are agglomeration economies?

A

Efficiencies in production due to multiple local, large-scale industries

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14
Q

Cities with industry economies may be more _______ to downturns due to cost advantage.

A

resistant

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15
Q

What long-term advantages will cities with agglomeration economies have?

A

-Incubator for new businesses
-Cost advantage for emerging industries

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16
Q

Urban growth causes real estate market ___.

A

growth

17
Q

What factors affect a bid-rent curve?

A

-Number of bidders (commuters or firms)
-Wage rate (time cost) of commuters
-Speed of travel
-Frequency of trips

18
Q

What does bid-rent analysis do?

A

Explains how urban land uses are determined

19
Q

What does bid-rent analysis assume?

A

Assumes all commuters have one demand for access (a single “linkage” defined as a relationship between land uses)

20
Q

What is the concentric circle model?

A
  1. CBD –Industry, commerce and Downtown
  2. Warehouse
  3. Transition (Industrial/Mfg)
  4. Blue collar
  5. White-collar Clerical
  6. Executive