Investors like to invest in single-tenant properties, because the expected administration and management expense is rather small, while multi-tenant properties are accused of having a higher expense. If this is the case or not does not only depend on the landlord but also on the tenant and his contractual options.
The presentation of the various risks of single-tenant properties as well as the presented examples show that this property type is only partly suitable as a safe real estate investment and therefore can also only partly be categorized in the core segment.
Especially the unpredictable reletting situation and a difficult to predict exit show that these properties are only suitable for investors, who are able to cope with the complete loss of their contributed capital and who have sufficient reserves to carry out necessary revitalisation measures.
All other investors are on the safe side with multi-tenant properties in the core segment. Investors, who nevertheless are interested in the segment of single-tenant properties, should take a closer look at the alternative use possibilities of their investment prior to investing to make sure that there is no bad awakening after the complete move of the first tenant.
Real estate investments are always “management investments” and they need professional support.