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Construction Finance

Approx. 17 hours to complete

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Course Summary

This course teaches you the basics of construction finance, including budgeting and cost estimation, project financing and risk management, and financial analysis.

Key Learning Points

Learn how to budget and estimate costs for construction projects
Understand project financing and risk management
Gain the skills to perform financial analysis on construction projects

Learning Outcomes

Develop the skills to create budgets and estimate costs for construction projects
Understand the basics of project financing and risk management
Perform financial analysis on construction projects

Prerequisites or good to have knowledge before taking this course

Basic knowledge of finance and accounting
Familiarity with construction industry terminology

Course Difficulty Level

Intermediate

Course Format

Self-paced
Online

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Description

The final course of the specialization expands the knowledge of a construction project manager to include an understanding of economics and the mathematics of money, an essential component of every construction project. Topics covered include the time value of money, the definition and calculation of the types of interest rates, and the importance of Cash Flow Diagrams.

Outline

Introduction To The Construction Finance Course
Construction Finance Course Introduction

The Mathematics of Money
Mathematics of Money - Project Evaluation
Computing Interest / Simple Interest Calculations
Compound Interest Calculations
Simple vs. Compound Interest Rate Example / Nominal and Effective Rate
Nominal Interest Rate Example and Minimum Attractive Rate of Return
Present and Future Value of Money
Future Value of a Uniform Series
Uniform Series
Uniform Series: A deeper dive
Equations for Uniform Series
Net Present Value (NPV) Example
Internal Rate of Return (IRR) Example
Mathematics Of Money
Case Study: Mathematics of Money

Real Estate Finance for Development Projects
Introduction to Financing Development Projects
Feasibility Study Example -- Project Parameters
Development Costs
"Comps" based Property Sale, Tax, Gain and Return
"Cap Rate" based Sale, Tax Gain and Return
Preview of "Discounted Cash Flow" Methods for Gain and Return
Framework for "Discounted Cash Flow" (DCF) Analysis
"Net Present Value" DCF Method for Project Evaluation
Net Present Value (NPV) Examples
"Internal Rate of Return" (IRR) Method for Project Evaluation
NPV and IRR Analysis with Excel
Changing and Comparing Compounding Periods
Real Estate Finance Development Projects
Feasibility Study: Estimating The Sales Price

Financial Plans for Development Projects
Introduction to Financial Plans for Development Projects
Debt Financing of Real Estate Projects
Construction Loan Example
Net Comprehensive Cash Flows for Sponsor and Lender
DCF Project Evaluation for Sponsor and Lender
Introduction to Decision Tree Analysis - 1
Introduction to Decision Tree Analysis - 2
Decision Tree Example - Overview
Solving the Example in Excel
Analysis of the Tree Results
Decision Tree Example with Time Value of Cash
Analysis of the Tree Results with Time Value Considered
Designing and Building Commercial Real Estate

Project Finance
Global Project Finance Overview and by Sector
Stakeholders in Project Finance
Stakeholder Roles
Principles of Project Financing
Risk and Risk Allocation
Categories of Risk Allocation
Sponsor Perspectives - Structuring and Documentation
Completion Risks / Government Perspectives
Contract Parties
Contracts and Agreements
Project Finance

Risk In Project Finance
Project Parties, Timeline, and Finance
Borrowing vs Partnering Case Study: Revenue generating case
Case Study: Developer land swap case / Identifying and Allocating Risk
Risk in Project Finance

Public - Private Partnerships
Public Private Partnerships (P3) Concept and Key Elements
Project Types
Drivers, Value and Typical Structures of P3
Responsibilities and Risk Transfer in various P3 structures
Pursuits through full project lifecycle and P3 Success Factors
Benefits of P3
Getting on Board with P3: Case Studies
A Deeper Dive Into P3 Case Studies
Public Private Partnerships

Lean in Construction Financing
Identifying Risk
Waste Concept in Lean
Mitigating Risk through Lean Project Delivery Systems
How To Access Probability and Mitigate
Lean in Construction Finance

Course Wrap-up
Course Wrap-up

Summary of User Reviews

Learn about construction finance with this highly-rated course on Coursera. Students have praised its practical approach and real-world examples.

Key Aspect Users Liked About This Course

Practical approach and real-world examples

Pros from User Reviews

Great practical examples
Easy to follow
Clear explanations
Useful for real-world applications
In-depth coverage of construction finance

Cons from User Reviews

Not enough interaction with instructors
Some sections are too technical for beginners
Could benefit from more case studies
Not enough emphasis on international construction finance
Some videos are too long

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Construction Finance

Topics covered include the time value of money, the definition and calculation of the types of interest rates, and the importance of Cash Flow Diagrams....

Save Course