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New Faculty Interview - Dr. Mark J. Eppli

Posted By David Walsh, Greystar, Tuesday, November 6, 2018


Dr. Mark J. Eppli was appointed Director of the James A. Graaskamp Center for Real Estate this Fall. Dr. Eppli returns to UW-Madison, where he received his BBA, MS, and Ph.D. degrees, after serving as a professor of finance and Bell Chair in Real Estate at Marquette University and teaching at the George Washington University for eleven years. While at Marquette, Dr. Eppli started the real estate program and brought it to national recognition by U.S. News and World Report. There Dr. Eppli also served as Interim James H. Keyes Dean of Business Administration from 2012-2015. He has co-authored two books on real estate, been recognized as a foremost real estate policy expert and Distinguished Fellow by NAIOP, and received awards for his efforts to attract minorities to the real estate profession.


Dr. Eppli, welcome back to the University of Wisconsin. After a very impressive tenure at Marquette University, what excites you most about your return to the Graaskamp Center for Real Estate?

Thank you, it’s great to be home. I’m surrounded by very welcoming and impressive colleagues, so it feels great to be back. Two of my primary responsibilities here are to put together a three to five-year strategic plan and steward the MS degree proposal through the University approval process alongside Sharon McCabe, both of which I’m excited to work on. The MS proposal is well underway, and the three to five-year strategic plan is in its early stages but will heavily consider the desires of our alumni. I’m excited to get on the road to visit our alumni and ask what they are passionate about, and then brainstorm how to get those initiatives into our program. We want all of the stakeholders on board with our mission, vision, and strategic plan.


As you mentioned, you are leading the efforts to reestablish the MS degree as soon as the fall of next year. What is the reasoning behind offering an MS degree again and how will it differ from the currently offered MBA program?

It helps to start by asking why the MS degree went away. It went away in 2005 when the school folded all the master’s degrees into the focused MBA program we have now. Now 13 years later, we have a new generation of young adults who, with the current state of the economy and job availability, are less interested in going into the work force for two years before returning for an MBA. A fair number of students want a quick hit degree, maybe in the format of a four plus one (i.e. four years of undergraduate and one year of graduate study). By quick hit degree I mean a program with a focused curriculum where students learn the technical aspects of commercial real estate and apply them. Think of it as a great complement to an engineering or economics degree, among many others here at the University of Wisconsin-Madison. Also, the UW system graduates over 5,000 business majors each year.  The MS is a great way to round out an education, after four years at a school in the UW system to come to the flagship university for the additional year and degree. We’re really going back to the future. A clear majority (90-95%) of our master’s grads before 2005 were MS students. The alumni want to bring the MS back, and I think the University and School want to bring it back as well.


As for why we are planning to offer the degree, I think it rounds out our curriculum offering. This year, we have 449 BBAs in real estate. In 2011-2012 there were 134. The growth in real estate majors is amazing.  One reason might be because the BBA program in real estate was ranked the best public-school real estate program in the nation by US News & World Report, second best overall. We have Wharton one ahead of us, and Berkeley one behind us on that list –  That’s a great pack to be running with. Our MBA program is great for students looking for a degree that enhances broader business decision-making and leadership skills, but students typically need to have several years of business experience to be eligible for the MBA program.  In summary, the MS is a great complement to our popular BBA and strong MBA programs.


Your research, leadership, and community involvement have been recognized by numerous organizations. Can you tell us about a particularly proud moment of your career?

I always start with the idea of being a servant leader. As a professional, you can only do as well as those around you, and I have been really lucky to have great people around me. So, I am thankful for those that I have worked with over the years at Marquette University, the George Washington University, and others. A point of pride for me is the establishment and operation of the ACRE program in Milwaukee, but once again, it took many great folks to make it happen. ACRE stands for Associates in Commercial Real Estate, and the program mission is to educate, place, and network minorities in commercial real estate. Our goal is to change the face of the commercial real estate industry by being more inclusive of minorities. The lack of diversity in commercial real estate is striking and worse than almost all other professional fields. I do not mean to suggest that this is driven by racism, but many firms are small, and when they go out to hire talent, they don’t have large interview lists on a campus. They ask within their existing informal networks for recommendations, and those networks sometimes aren’t as diverse as you would like to see. ACRE consists of six credits across one academic year, where the curriculum focuses on financial and real estate decision making skills. The program has graduated over 250 students. They’ve collectively developed over 1,000 apartment units, three are now aldermen in the city of Milwaukee, three are executive directors for Business Improvement Districts (BIDS) in Milwaukee, and three brothers who all went through the ACRE program started JCP, a minority owned construction company.  In closing, it was the willing support from philanthropic donors to wise instructors to the students themselves that collectively made the ACRE program a success.  


What is your current research focus?

I’m currently looking at holding period analysis for investment portfolios. You learn in finance courses stocks are riskier than bonds, but the standard deviation metrics are for one year, and rarely do we hold retirement portfolios for one year – so why use one-year standard deviation to measure risk.  A more relevant measure of risk is over the likely holding period of the investment. Across time, stocks and real estate returns mean revert, to their long-term return averages, say eight to nine percent. Over a seven-year holding period, average stock annual standard deviation goes from about eighteen percent to six percent and real estate return risk also drops precipitously.  This lower risk profile for stocks and real estate has important implications for the makeup of a long-term investment portfolio and long-term expected returns. 


What has been a highlight of your fall in Madison so far?

As you may know, I have rented an apartment near the Capitol Square and kept our house in Milwaukee until my daughter graduates from high school.  So, my commute each day has me walking past the Capitol and up State Street to the great University of Wisconsin-Madison, which brings back any range of great reflections daily. Also, getting back to the terrace with friends as they return to campus and thinking back on our time here as students is a treat – popcorn is the same, beer selection is better!  

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