Portfolio of Qualifying Experience Workshop

1. Portfolio ofQualifying Experience Workshop Networking Education Technology

2. Eddie D. Blanton, CCIM CCIM Designee, May 3, 2001 NC CCIM Chapter Board Member Since 2003 Resume Writing Class Instructor Since 2003 CCIM 2004 National Convention Committee Member NC CCIM Designation Promotion Committee Chair Since 2004 NC CCIM Chapter Executive Board, Secretary, 2006-2007 Founding Principal Member of Sperry Van Ness/Lighthouse Commercial Realty

3. What is a Portfolio Of Qualifying Experience? The Portfolio of Qualifying Experience is: • A standardized means for candidates to verify the quality of their work as commercial-investment professionals. • A means to document having achieved at least the minimum level of experience required to qualify for the CCIM Designation.

4. Timeline • Portfolios may be submitted at any point during candidacy. • The published portfolio deadline is the last date for which portfolios will be accepted to allow sufficient time prior to the Comprehensive Examination for review and grading.

5. Candidate Guidance Schedule

6. Agenda • Current Designation Requirements • What Graders look For In Portfolios • Qualifying Activity Requirements • Review Submission Requirements • Review Example Portfolios • Important Updates Effective 9/01/06 • Discussion/Questions

7. Current Designation Requirements

8. General Candidacy • Become a candidate • Complete all four (4) core courses • CI 101, CI 102, CI 103 & CI 104 • Earn three (3) elective credits Elective credits can be earned through multiple sources including completing the Introduction course, attending the Course Concepts Review program, attending a CCIM Conference or Symposium, consecutive years of candidacy, completing a CCIM Advanced Education or CCIM Online Education course, or Transfer Elective Credits. • Prepare and submit an acceptable “Portfolio of Qualifying Experience” • Successfully complete the Comprehensive Exam

9. Volume Requirements for General Candidacy

10. Fast Track Candidacy The Fast Track Program gives real estate professionals the opportunity to earn the CCIM designation in a convenient and streamlined format. This accelerated program is available to professionals who have earned one of the following designations: AACI, CLO, CMB, CRF, CPM, CRE, FRI* , MAI/SRPA, RPA, SIOR. *Must show proof of qualifying activities in commercial real estate to be approved by the designation committee for fast track status. Fast Track Candidates are only required to do the following: • Become a Fast Track candidate. • Successfully complete the four CCIM core courses (CI 101-Financial Analysis, CI 102-Market Analysis, CI 103-User Decision Analysis, and CI 104-Investment Analysis). • Pass the Comprehensive Exam *In recognition of the extent of their training and experience, fast-track candidates are exempt from the elective credits requirement and from the Portfolio of Qualifying Experience. *All requirements of the Fast Track Program must be completed within 24 months.

11. Assembling Your Portfolio Of Qualifying Experience

12. When Assembling Your Portfolio All elements of the portfolio must be typewritten and placed in a 3 three-ring or spiral binder. • Eachqualifying activity is submitted as a separate section of the portfolio. • Activities should be arranged in reverse chronological order (most recent first, and so on), with each section separately tabbed and numbered. • Each Portfolio Submitted should contain the Following: • Portfolio Summary Sheet • Summary of Qualifying Activity • Activity Data Form • Narrative or Comprehensive Case Study (if submitting under the old requirements) • Executive Summary • Settlement Documentation • Proof of Candidates Role (as documented in the Designation Handbook)

13. Proof Of Candidates Role Candidates are required to submit two proofs documenting their role in each transaction supplied. Documentation can include: • Completed documents with signature • Proof of compensation • Notarized Statement of Specific Involvement and verifies your exact role. • Copy of a deed showing you as grantee or grantor *Questions regarding verification of proof, please consult Designation Handbook

14. Activity #: Property: Tenant Name: Transaction Date: Overview of the Property:In this transaction, I was the listing agent for this 20,000 square foot, suburban office building located in the Ran Air market area of Mair County. A local law firm developed the building in 1988, and the economic recession of the early 1990's forced them to default on the loan and the lender, ________________ Company (in receivership), regained possession of the building. As evidenced by the name, the court-appointed receiver, located in Michigan, monitored the activity of the lenders. Our firm acts as the exclusive leasing agent and property manager, and we report to a regional asset manager in St. Louis, Missouri. When assigned the responsibility for the project in the fall of 1994, the occupancy level of the project was at 30%. Overall conditions in this 2.1 million square foot office market indicated a 15% vacancy, but there was speculative construction occurring at a rate of 33,000 square feet per year. While it is not a large area, Mair County is one of the fastest growing municipalities in the state, in terms of population growth. The focal points of economic development in the county are two large Department of Defense institutions, the Wanli Air Force Base, and Winkler Arsenal. There is also a rapidly expanding health care system. Having attended the CI 104 and 103 programs during this leasing program, I used the skills taught in those courses. I created a target-market analysis report to explain the local market conditions for the non-local receiver. The leasing report I created determined that the best tenants for the building would be the defense industry members who were involved in regional projects in the area. These contractors have multi-year contracts for environmental cleanup activities, as well as other research related programs. Because these companies require cancellation clauses in their leases in the event that the contract with the military base is canceled, some landlords consider them risky. By categorizing over 60 large office users in the science and technology area in terms of their current location and length of occupancy, I explained to the landlord that this risk was not that great, and that 80% of these tenants stayed in place in their existing buildings for a minimum of 4 years. Our database indicated that a potential prospect occupied more than 250,000 square feet currently. By stating the financial strength of these potential tenants (most are Fortune 500 companies), the owner was surprised at the "credit quality" of the potential tenant mix. This "credit quality" was not what they anticipated in such a small market area. The owners gave permission to proceed to pursue aggressively transactions in which national companies would have interest in this project. SampleNarrative

15. Even though the building was over 70% vacant, the largest contiguous deliverable suite was 4,000 square feet. I utilized a comparative lease analysis to determine the most appropriate strategy for dealing with this issue. Considerations such as relocating the one existing tenant out of the first floor to create a 7,000 square foot suite, was balanced against the possibility of being able to utilize the existing improvements in the smaller suites. We recommended that the floor remain multi-tenanted, but we decreased the amount of public areas in the building by several percent. Because the asset manager located in St. Louis reported and received all necessary approvals from the receivers in Michigan, the reports we presented were critical to any success we achieved. A market study, similar to those presented in CI 102 and CI103, was a part of the 1996 budget process. All proposals required a “lease alternative”, to compare the prospective lease to that presented in the 1996 budget. Because the each transaction had an early termination clause, discounted cash flow analysis became a very important part of the financial evaluation of the potential leases. In our market, a tenant-representative broker represents almost every one of these prospective tenants. Most of these tenant-representative brokers connect through a national network or affiliate with a national firm. I not only contacted the tenants directly, but also their brokers to expedite the transactions. Two of these brokers were beginning office space surveys. One was for a defense contractor known as Raabe International, and the other was for a general office requirement for the Lohman Corporation. Ironically, even though the Lohman Corporation was not in the defense industry, they required an early termination clause effective at the end of the third year of the initial 5-year term of their lease. The calculator utilized was an HP-12C, with Lotus software for the spreadsheet analysis. (Copies of some of the work attached to this narrative.) With these two leases, as well as others (3 defense, 1 medical, 1 general office), the building is now 82% leased, and the N.O.I. was $213,000 for 1997. The owners and receivers are pleased with our progress, and the property is listed with us for sale at a price of $1.9 million. The sales presentation will include an N.O.I. calculation as presented in CI 104 with future cash flow potential, and an I.R.R. calculation. My role in this project as exclusive listing agent continues, and I am now also the exclusive selling agent. SampleNarrative Continued

16. SampleExecutive Summary Activity #: Property Name: Assignment Date: Completion/Settlement Date: Property Description: (Property Name) is a 10097 sq. ft. industrial facility located on 1,094 acres of land in the (Location) Industrial Park. The property features an 18' clear ceiling height, one dock and one grade level door, and 400 amp 3 phase power. The building has approximately 1,785 sq. ft. of finished office space, with 5 private offices, a reception area, a general office area, storage rooms, and two washrooms. Client's Goals & Objectives: The owner of the building had outgrown the facility and had purchased a vacant piece of land upon which they were to construct a new facility. The owner's objective was to sell the building to a purchaser who was willing to lease it back on an interim basis until the new facility was ready for occupancy. Your Role in Achieving the Client's Goals & Objectives: I was given the exclusive listing to market the property in (Date) at a price of $395,000. During the marketing period, over 20 different parties toured the facility, and (Number) prepared an offer to purchase at a price of $350,000 through their agent, (Name) of (Location). The offer called for a possession date of (Date), but did not allow any flexibility in the event that the new facility was not completed by this time. After reviewing all of the comparable market information, I recommended that the offer be countered at a price of $360,000, clause be inserted to the effect that the Vendor could, at its option, lease back the facility for up to 3 months following the date of closing, at a rate of $5,000 per month gross. My recommendations were accepted by both the Vendor and purchaser, and the transactions proceeded to close as scheduled. Signature: _____________ Date: _________________

17. SampleNotary Letter CCIM Institute430 North Michigan Avenue, 8th FloorChicago, Il 60611To Whom It May Concern:As the Corporate Real Estate Manager for the (company name) and with direct knowledge of (candidate name) activities, I certify that he has materially participated, and represented (company name) interests in the following transactions:Englewood, CO 6115193 LeaseEagan, MN 4130193 LeaseOmaha, NE 12104192 LeaseSchaumburg, IL 06112192 Leasehold ExpansionRockford, IL 11112191 LeaseLincoln, NE 8116191 LeaseBettendorf, IA 614191 LeaseChicago, IL 2113191 LeaseSchaumburg, IL 215191 LeaseWest Des Moines, IA 211191 LeaseFurthermore, I have reviewed the narrative that (candidate name) has prepared on each of these transactions and hereby attest that they accurately portray his/her role in bringing these transactions to a close.If you have any questions regarding the (candidate name) role at (company name), please do not hesitate to contact me.Sincerely,Notary Seal

18. SAMPLE LAY-OUT

19. Additional forms can be found here: www.ccim.com/education/ccorner_index.html Portfolio Forms and Formats

20. What Graders Look For In Portfolios

21. What Graders Look For In Portfolios • Graders are CCIMs who have successfully gone through the rigors of preparing their Portfolios and are proud of their CCIM pin • The graders look for a presentation that, in part, reflects the quality of your professional work that befits the CCIM designation.

22. The first thing Graders review is the Portfolio Cover Sheet It is important that you follow the assembly directions by the using: CCIM Portfolio Checklist Summary of Qualifying Activities; and, The Activity Data Form Ensure you have supplied the proof of activity and proofs of Candidate’s role What Graders Look For In Portfolios

23. What Graders Look for in Portfolios • Graders reviewing your Portfolio look for a demonstration of the CCIM skills you used or could have been used in your Narratives or Comprehensive Case Study. • Whichever skills you select, demonstrate what you used or could have used in your transactions • You must submit a demonstration of your application of these skills by use of an APOD, demographic data, etc. or any of the other skill sets learned through the course curriculum

24. What Are Qualifying Activities? • Qualifying activities are those that have taken place within five years of the portfolios submittal date • Activities in which the candidate has had material participation. • Completed activities involving the transfer, lease, finance, or development of real estate for appreciation or production of income, or used in a trade or business, or complete consulting reports, may be included in the portfolio. Rule of thumb: • Where there is a question of whether or not your specialization qualifies for the designation, refer it to the overall principal: There must be substantial involvement with real property of a commercial and/or investment nature

25. Qualifying Activity Requirements

26. Required Contents • Portfolio Cover Sheet & Summary Of Qualifying Activities • Activity data form • Narrative or comprehensive case study • Executive summary • Settlement documentation that substantiates the completed activity • Proof of the candidate’s role

27. Qualifying Your Transaction

28. Qualifying Transactions Include: • Sale/Purchase/Exchange • Commercial Mortgage Financing • Consulting • Development • Lease • Qualifying Residential Income Property

29. SALE/PURCHASE/EXCHANGE • Completed Property Transfer • Volume = Value (Price) of Property Conveyed • Substantiation • Submit Significant Elements • Highlight Your Signature

30. COMMERCIAL MORTGAGE FINANCING • Closed First Position Loans on Qualified Commercial Property • Volume = Amount of Financing • Substantiation • Copies of Documents • Highlight Your Signature

31. CONSULTING • Completed consultant’s report and analyses • Prepared by a fee consultant • Volume = Value of Project • Substantiation • Copy of documents • Highlight Your Signature

32. DEVELOPMENT • Completed developments that can be fully documented and analyzed • Volume = Present Value of Completed Development • Substantiation • Copy of documents • Highlight Your Signature

33. LEASE • Completed Leases • Volume = Gross Value of Lease Signed (No Options or Automatic Renewals) • Substantiation • Copy of documents • Highlight Your Signature

34. RESIDENTIAL INVESTMENT • Residential Investment Properties are defined as: • Properties that are not owner occupied and; • The property must be professional managed and; • In single family, duplex, or tri-plex investment transactions, a written lease must exist and a copy of such lease must be submitted and; • You are required to attach supportive documentation that demonstrates your use of the CCIM skills in the marketing of any residential investment property • Notarized or similar documentation must be provided that substantiates the property as non-owner occupied investment.

35. Non-Qualifying Transactions • Mortgages - Less than 4 Units • Land Sale - Less than 4 Lots • Transactions Without Material Participation • Residential Leases • Business Opportunities (exclusive of commercial real estate)

36. Narratives and Comprehensive Case Study

37. NARRATIVES Those who submit under either the $5 million or 20 activity options and do not choose to submit a comprehensive case study must submit: • Five typed or computer-printed narratives of three to five pages in length, double spaced. • Choose the activities that are most representative of the type and quality of your work. • Each narrative must be unique.

38. CCIM CORE SKILLS As you compose each narrative: • Review the list of CCIM skills taught in the core courses • Determine which skills you used in the activity • Explain how you used them

39. COMPREHENSIVE CASE STUDY • Extensive Narrative • Fully Documented • Financial Analysis (Outline of assumptions) • Skills and Knowledge • Exhibits • In the event the activity did not include all skills required, hypothetical courses of action should be developed and included

40. Comprehensive Case Study: Required Contents • Activity Data Form • Narrative • Outline of Assumptions • Analysis & Computations • Demonstration of Skills & Knowledge • Pertinent Exhibits • Maps, plats, floor plans, photos, correspondence, etc., that are pertinent to the activity

41. Reminder:Portfolio Submission • The portfolio must be one volume in an 8.5” x 11” format (legal size documents must be reduced), bound on the 11” side in either a 3 three-ring or spiral binder. Submittals in any other format or more than one volume will not be accepted. • Transactions or qualifying activities must be numbered in reverse chronological order (most recent as number 1, and so on), with each section separately tabbed. It is suggested that the print size of narratives not exceed 12-point type. • Prepare two copies and keep one for yourself in case revisions are required. The original will not be returned to you.

42. Important Updates Effective 09/01/2006

43. New Volume Requirements Effective 9/1/06

44. Addendum *Students who become, or are candidates in good standing by August 31, 2006, may select from either the current or the new Portfolio Of Qualifying Experience requirements. You will be eligible to submit the Portfolio Of Qualifying Experience, under the current requirements, until September 1, 2008.**It is mandatory for All Students, who become candidates after September 1, 2006, to fulfill the new Portfolio Of Qualifying Experience requirements.

45. Additional changes:Portfolio Guideline Requirements As of September 1, 2006, under the new Portfolio of Qualifying Experience guidelines, it will no longer be mandatory to provide either a comprehensive study or a series of narratives, as currently defined in the Candidate Handbook. However, the requirement that a candidate must provide two documents evidencing their material participation in the transaction will remain obligatory.

46. Announcing Two New Portfolio Categories Effective 09/01/2006

47. Active Manager Qualification

48. Active Manager Qualifications a. Must manage 3 or more agents b. Volume will be documented and verified c. Multiply the number of agents you manage (10 agent maximum)by $5 million and then multiply the result by 75% d. Minimum of 15 or more qualifying transactions equal to or greater than the dollar amount derived in (b) above Active Manger category can include the following professions: • Asset / portfolio advisors and managers • Corporate real estate officers • Pension fund or insurance managers • Supervising / Managing Brokers

49. Active Advisory Qualification

50. Active Advisory Qualifications • A minimum of $500,000 in gross (commercial & investments) income during the proceeding 5 year period • Income derived from qualified transactions, as defined Active Advisory category can include the following professions: • Exchange Facilitator • Accommodators • Consultants