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Basic Question 1 of 4
The credit quality of a commercial property portfolio is determined by the credit quality of the ______.
B. underlying properties
C. management company
A. underlying tenants
B. underlying properties
C. management company
User Contributed Comments 2
| User | Comment |
|---|---|
| thebkr777 | Can anyone explain? |
| FRAbyFRA | Think of credit quality in the context of a bond. If the bond issuer has low credit quality, it becomes more likely that coupon payments won't be made. The same applies to rent payments from commercial property tennants, which provide the "fixed income" portion of the property's return. |
I used your notes and passed ... highly recommended!
Lauren
Learning Outcome Statements
describe the economic factors affecting investment in commercial real estate.
CFA® 2025 Level II Curriculum, Volume 6, Module 37.