Question 1

The primary institutional investors in equity real estate are:&#10;A) pension funds&#10;B) federal credit agencies&#10;C) unions&#10;D) none of the above

Accepted Answer

Pension funds are the primary institutional investors in equity real estate. They invest in real estate through various vehicles like real estate investment trusts (REITs) and private equity funds. Federal credit agencies and unions may invest in real estate as well, but they are not the primary institutional investors in equity real estate.

Question 2

Insurance companies invest primarily in:&#10;A) CMOs&#10;B) commercial mortgages&#10;C) residential mortgages&#10;D) none of the above

Accepted Answer

Insurance companies typically invest in commercial mortgages because they provide a stable source of income with low default rates. CMOs and residential mortgages are less common investments for insurance companies due to their volatility and liquidity risks.

Question 3

The largest supplier of commercial real estate debt is:&#10;A) state and local retirement funds&#10;B) commercial banks&#10;C) thrifts&#10;D) pension funds

Accepted Answer

According to various research and surveys, commercial banks are the largest suppliers of commercial real estate debt. They constitute a majority of the debt financing in the commercial real estate industry.

Question 4

Thrifts specialize in:&#10;A) residential loans&#10;B) multi-family properties&#10;C) commercial properties&#10;D) none of the above

Accepted Answer

Thrifts, or savings and loan associations, are financial institutions that specialize in providing home mortgage loans and other consumer loans to individuals. Therefore, choice A, residential loans, is the best answer.

Deck 17: Sources of Funds for Commercial Real Estate Properties