REAL ESTATE • INVESTMENTS • METRICS
Class A properties are generally newer buildings that are in excellent condition and have high-quality amenities. These properties are typically located in prime locations, such as downtown areas or affluent suburbs. Class A properties attract high-end tenants, such as businesses and professionals who are willing to pay premium rents for top-quality facilities.
Investing in Class A properties offers several benefits. They are generally easier to lease, have lower vacancy rates, and are more likely to retain their value during economic downturns. However, Class A properties also come with a higher purchase price and often require significant upfront capital investment.
Class B properties are older buildings that are generally in good condition but may require some upgrades or renovations. These properties are located in less desirable areas than Class A properties but still offer attractive amenities and features. Class B properties attract middle-income tenants, such as families and young professionals, who are willing to pay reasonable rents for good-quality facilities.
Investing in Class B properties can be a good way to generate solid returns without the high upfront costs associated with Class A properties. However, Class B properties often require more maintenance and upkeep, and may experience higher vacancy rates than Class A properties.
Class D properties are the riskiest of all the property classes and are generally considered to be the most speculative investment. These properties are typically in poor condition and located in low-income neighborhoods with high crime rates. Class D properties are often distressed, foreclosed, or in need of significant repairs.
Investing in Class D properties can be highly profitable if the investor is able to turn the property around and improve its condition. However, these properties come with the highest risks, including high vacancy rates, difficult tenants, and a potential for low returns on investment.
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