303: C Class Properties Can Pose Undue Risk In A Tough Economy

By ruthlessly managing expenses, you can make C Class properties profitable, but there are ongoing challenges and risks. Even after you’ve stabilized the properties, there are continual maintenance issues and expenses you can’t accurately predict. Issues with outdated plumbing and electrical systems plus other issues erode net operating income. In addition, the possibility of further inflation and unemployment combined with rising expenses pose further risk. Jason Biak, Partner of Compounding Capital Group, has done a great job optimizing C Class assets despite these challenges in the Cincinnati market. Jason also anticipates prices on B class properties to gradually come down over the next several months.