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CFA Level 3
Alternative Investments

Risk Considerations in Commercial Real Estate Investments

Easy Real Estate Investment Risk Considerations

As an investment manager specializing in alternative investments, you are tasked with analyzing a real estate investment opportunity. Your client believes that investing in commercial real estate can provide consistent cash flows and potential for appreciation. However, various risks could impact the investment's performance.

Your task is to identify and discuss the key risk considerations associated with commercial real estate investments. Address factors such as market risk, tenant risk, financing risk, and environmental risk. Additionally, include strategies that can be employed to mitigate these risks.

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