Unlike other segments of commercial real estate, apartments offer owners flexibility. With shorter leases, often running between six and 24 months, apartment operators can be more attuned to a changing economy.
"As those leases roll-off, you're able to readjust those rent roles based on current market conditions," says David Vincent, Cadre's Investment Specialist. "So you have a lot more flexibility than say industrial or office."
These shorter-term leases provide apartment owners with the ability to adjust rents upward as the economy improves (or they can see rent deteriorate quickly if the economy decelerates). "On the revenue side, you can increase the rent rolls," Vincent says. "As people want to renew or you bring in new tenants, you've got a lot more flexibility versus other types of real estate."
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Leslie Shaver
Les Shaver has been covering commercial and residential real estate for almost 20 years. His work has appeared in Multifamily Executive, Builder, units, Arlington Magazine in addition to GlobeSt.com and Real Estate Forum.
