v. Risk Types & Mitigation

Risk types and mitigation strategies describe the uncertainties that can affect real estate performance and the measures used to manage or reduce their impact. Identifying and addressing these risks is central to investment decision-making, underwriting, and long-term asset resilience.

Construction Risk

The risk of cost overruns, delays, or defects arising during development or renovation.

Credit Risk

The risk that a borrower or tenant fails to meet financial obligations.

Environmental Risk

Exposure to contamination, regulatory constraints, or environmental liabilities affecting a property.

Interest Rate Risk

The risk that changes in interest rates affect borrowing costs, cash flow, or asset value.

Liquidity Risk

The risk that an asset cannot be sold or refinanced quickly without a significant loss in value.

Market Risk

Exposure to changes in supply, demand, pricing, or economic conditions within a market.

Mitigation Strategy

Actions taken to reduce the likelihood or impact of identified risks.

Operational Risk

Risks arising from property management, maintenance, systems, or human error.

Regulatory Risk

The risk that changes in laws, zoning, or compliance requirements adversely affect an asset.

Tenant Risk

The risk associated with tenant concentration, credit quality, or lease rollover.