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 Treasuries and a lower volatility than equities, they do require thoughtful due diligence prior to investment and careful monitoring throughout the investment life. Whether you invest yourself or with a fund manager specializing in commercial real estate, consider the following guidelines to protect your commercial real estate investments and to survive multiple economic cycles.
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