Question

Which of the following is NOT a component of Real Estate risk?   Tenant rollover risk   Upcoming...

Which of the following is NOT a component of Real Estate risk?

  1.   Tenant rollover risk
  2.   Upcoming debt maturity
  3.   Property owner decides to sell the building
  4.   Key management turnover
  5.   Change in cap rates due to increasing in interest rates

Homework Answers

Answer #2

The correct option is D i.e Key management turnover.

Key management turnover is not a component of Real estate risk because it is associated with highly intensive industries that are more of a routine in nature. Real estate risk might arise from such things as liability, legal issues, partner problems that can force a sale, fire or theft, loss of rental income, and purchasing a property with an imperfect title.

Thus, the key management turnover is not a component of real estate risk.

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