How safe are net lease property investments?
Real estate investment is a relatively risky endeavor. It can be considered more or less risky depending on may variables. The Net- lease investment is considered by many to be one of the least risky of all real estate investments, since these properties (usually) do not involve tenant turn-over (and the costs associated with re-leasing) are usually long-term, and if the tenant is considered “investment grade”, the risk is substantially mitigated. Multi-Tenant Retail: Since retail sales are so dependent on the property location and overall economic indicators, it is considered to be one of the most risky real estate investments. A new by-pass can change a traffic pattern and virtually “kill” a retail properties’ vitality overnight. On-going demographic shifts can change shopping patterns and a retailers’ market can dry-up over time. Inflation and product shortages can cause further problems. A multi-tenant retail owner must consider the likelihood of losing its “mom & pop” local retail
