Renovating Four REIT-owned Landmarks
November 4, 2019 | Robyn A. Friedman | Nareit
Unlike some fine wines, everything does not improve with age. Real estate owners and asset managers understand that buildings, no matter the sector, need occasional remodeling, either to meet the needs of current or prospective tenants, to avoid obsolescence, or to keep the property competitive in its market.
“In order to compete effectively in most property sectors, one needs to invest a sizable amount of capital in ongoing maintenance and improvements,” says Cedrik Lachance, director of REIT research for Green Street Advisors. “The investment needs to be made in infrequent but recurring capital improvements to the property.”
Lachance says the frequency of upgrades varies by sector, by owner, and by market.
“Some owners prefer to maintain buildings consistently to high standards and other owners will elongate the period between renovations,” he adds.
