Commercial Investment Real Estate March/April 2017 | Page 24

THE SECOND OF SIX STORIES
ON THE 50TH ANNIVERSARY
OF CCIM INSTITUTE
Convergence of
Excellence
How CCIMs shaped the
industry during revolutionary
changes in the late 1960s
and 1970s.
Five
decades ago, the com-
mercial real estate industry was poised at the transi-
tion of private ownership and wildcatter developers
to become a global, public, professionalized industry
with increasingly complex ownership and fi nancial
structures. Early leaders of CCIM Institute, such
as Victor Lyon, CCIM, and Jay Levine, CCIM,
became champions of applying the internal rate of
return to commercial real estate and adopting it as
the CCIM standard. By the early 1970s, IRR was
written into all the CCIM designation core courses
led by Stephen Messner, Ph.D., who was then at
the University of Connecticut in Mansfi eld, Conn.
During the 1970s, IRR paved the way for com-
mercial real estate professionals to navigate momen-
tous changes such as the development of regional
shopping centers, chain hotels, and suburban
planned communities nationwide. Even nearly 50
years later, IRR is one of many practical, crucial
methods to manage the increasing complexity
within the industry.
“Jay Levine and Vic Lyon gave strong support
to inculcating the IRR concept as a means of help-
ing to examine commercial property investments,”
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March | April 2017
says Mark Lee Levine, CCIM Senior Emeritus,
JD, LLM (Tax). “Understanding the six func-
tions of the dollar, the time value of money, and
how these precepts can and should apply to com-
mercial real estate are part of the foundation that
helped build the CCIM organization and CCIM
designation.
“Those who fi rst learned of the IRR concept
when taking CCIM courses were quick to under-
stand the price of a property is only one factor affect-
ing the investment decision. The fi nancial terms,
such as when monies were paid and the interest
rate was being paid on deferred obligations, are also
crucial factors to weigh in the investment decision.
Through the IRR concept, Jay and Vic showed
thousands of brokers why an understanding of IRR
was crucial. In turn, the teaching of IRR became a
hallmark of the CCIM program and remains part
of the curriculum today since it continues to be rel-
evant for investments.”
During 50 years of entrepreneurialism, exuber-
ance, and excess, CCIM Institute has been a power-
ful presence, and CCIM designees remain stewards
of the highest values of professionalism and ethics.
COMMERCIAL INVESTMENT REAL ESTATE
by Sara S. Patterson