Case | HBS Case Collection | April 1990 (Revised December 1995)

SouthPark IV

by William J. Poorvu

Abstract

A young entrepreneur examines an 80,000 square foot office/warehouse building as a potential acquisition. The building is currently fully leased but all four leases will expire shortly. Due to changing market conditions, the protagonist has to look at current market conditions as well as trying to estimate future conditions in order to complete his analysis. The case is designed to explore basic issues in real estate valuations. The emphasis is on developing a simple set-up based on the project's cash flows and then examining how returns and values are affected by changing certain assumptions.

Keywords: Mergers and Acquisitions; Valuation; Property; Management Analysis, Tools, and Techniques; Leasing; Cash Flow; Real Estate Industry;

Citation:

Poorvu, William J. "SouthPark IV." Harvard Business School Case 390-181, April 1990. (Revised December 1995.)