Thoughts on risk number 10: Incorporating skill
Real estate is a real asset class and managers have an influence on both risk and return.
Risk can be lowered and returns improved through superior skills in delivering higher growth, lower costs and lower vacancies, especially in a downswing.
For this reason, it is important to track these outcomes over time from properties under management.
At RES we model risk and return based on your assumptions for the drivers of risk and return. Comparing these figures with the market average will estimate the impact of your superior management skills (alpha).
For more information email contact@realestatestrategies.co.uk