The capstone class was designed as the culmination of the Costello College of Business's Master of Science in Real Estate Development (MRED) program. As one of their last classes, graduating students form a development team that closely simulates working in the private sector.
The student team is assigned a real-world site with an owner who is the team's client. The team must create a full-scale development analysis and present a final report to the client detailing how to build the highest and best use project. The 3.31 acres for the recently completed capstone is an infill site in the City of Fairfax with zoning approval for mixed-use development. The owner is the Lann Company, a 34-year-old land development company in Northern Virginia, founded and directed by John Napolitano.
Initial site visits and informative sessions with the owner and city planners served to define expectations and align goals. The team first performed a SWOT analysis:
Strengths: Location and Strong Employment Numbers.
Weaknesses: Site Bifurcated by Utility Easements. Vehicular Access.
Opportunity: Strong Housing Market.
Threats: High Interest Rates.
This was followed by a series of technical meetings with leading industry experts that included a zoning attorney, a nationally recognized architectural firm, a large general contractor, several major developers, a brokerage firm, and a lending institution. This served as a knowledge base that guided the team in exploring development options for the site, which included for-sale and for-rent multi-family housing, retail, hotel, office, or a combination of two or more of these uses. The team produced a proforma for each product type. Detailed proformas included hard/soft construction costs, operating costs, debt service, rent/sale income and timelines for entitlements, construction and lease-up or sales.
Through this process, the capstone team identified a clear recommendation: stacked townhome condos (STC). The STC product was clearly superior to all other options, whether judged by land value creation for a sale or return on investment if the Lann Company decided to develop the land and sell the condos. While the STC product is new in the housing market, the client was enthusiastic about the very high density possible through STC's innovative design which minimizes the building footprint using rear-loaded surface parking and alleys.
The student’s professional presentation allayed Lann Company's hesitation to build this relatively unknown housing product with well-researched cost and income data as well as documented market research from successful STC projects in the Washington, D.C., area.
This year's capstone experience illustrates the benefits of Costello's strategy for professional education: promote the cross-fertilization between classroom learning, real estate industry professionals, and local government staff. In this case, all three players benefit.
-
The student team experienced their future careers as a professional developer.
-
The development company benefited from the students' cutting-edge knowledge of residential design.
-
The City of Fairfax was provided with a professional evaluation of what the market wants to build in their city.
Our 2024 MRED Capstone Team:
-
Ada Inyew
-
Alecia Williams
-
Allison Gosser
-
Angell Bolden-Green
-
Arturo Garcia
-
Elizabeth Nguyen
-
Fabrizzio Arteaga
-
Hiba Elsayed
-
John Sommer
-
Lee Gumagay
-
Max Sivohins
-
Peter Murphy