There are too many painful stories about individual and corporate retirement funds facing severe funding deficits due to historically low interest rates on bonds. As a consequence, many fund managers have turned to commercial real estate investments as one of the few assets classes offering attractive risk-adjusted cash flow returns.
While these investments offer yields at a premium to Treasurys and a lower volatility than equities, they do require thoughtful due diligence prior to investment and careful monitoring throughout the investment life. Consider the following guidelines to protect your commercial real estate investments and to survive multiple economic cycles.
Robert Kantor is founder and CEO of Headwater Capital Inc. He served as the chairman and CEO of a succession of real estate investment and development companies over the past 40 years. In this capacity, he has acquired and managed investments in excess of $500 million.
This gallery is adapted from the original version that first appeared on our sister publication NREI Online.