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Risks
Market Risk: REITs can be subject to general market volatility and fluctuations, which can impact their stock prices and overall performance.
Interest Rate Risk: Changes in interest rates can affect the borrowing costs and profitability of REITs. Rising interest rates may increase borrowing expenses and reduce property values, potentially impacting the returns of the REIT.
Economic Downturns: REITs, including Starwood Property Trust, can be vulnerable to economic downturns. During recessions or periods of low economic growth, demand for real estate may decrease, affecting occupancy rates, rental income, and property values.
Property-Specific Risks: The performance of a REIT can be influenced by factors specific to the properties it owns, such as changes in local real estate markets, tenant vacancies, lease expirations, or unexpected maintenance or repair costs.
Regulatory and Legal Risks: Changes in regulations, tax laws, or other legal requirements can impact the operations and financial performance of REITs.