Two Common Risks in Real Estate Acquisition and Development

Ashcroft Capital

An expert in property acquisitions, Frank Roessler is the founder of Ashcroft Capital, a California-based real estate investment firm dedicated to acquiring and operating properties with significant value-added components in major metropolitan areas. As the leader of the firm, Frank Roessler applies risk management practices in the acquisition, development, and financing of properties.

Understanding the risks associated with real estate investments is a critical step in any real estate acquisition (e.g. retail, residential, industrial, mixed-use, and commercial properties). The two most common risks involved in a real estate acquisition are market risks and financial risks.

Market risks in real estate are associated with changing economic factors such as inflation, interest rates, tax management, and government policies. Real estate investment firms can hedge market risks by diversifying their investment portfolios. In case of a local economy setback, investments in more than one market help minimize losses.

Financial risks pertain to the risk of losing money on the property that may be caused by overpayment for the asset in the first place or underestimating the capital needs for repositioning the property. Inadequate insurance and over-leveraging a property may also lead to foreclosure or taking a loss on the property, both of which impose a financial risk to one’s investment.

Please visit https://www.ashcroftcapital.com/about/frank-roessler/ to learn more about Ashcroft Capital’s real estate acquisition and repositioning strategies.

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