CNSREIT-AR-2024 Final - Flipbook - Page 40
Competition for investment opportunities may reduce our profitability and the return on your investment.
We face competition from various entities for investment opportunities in properties, including other REITs, real estate
operating companies, pension funds, insurance companies, investment funds and companies, partnerships and developers,
some of which are likely a source of reasonable alternatives under Regulation Best Interest. In addition to third-party
competitors, other programs sponsored by the Advisor and its affiliates, particularly those with investment strategies that
overlap with ours, may seek investment opportunities in accordance with Cohen & Steers9 prevailing policies and
procedures. Some of these entities may have greater access to capital to acquire properties than we have. Further, advances
in technology, including through artificial intelligence capabilities and automation, may require us to adapt our strategy,
business and operations to address these trends and pressures, and our competitive position may weaken if we are unable to
meet these client priorities. Competition from these entities may reduce the number of suitable investment opportunities
offered to us or increase the bargaining power of property owners seeking to sell.
Additionally, disruptions and dislocations in the credit markets could have a material impact on the cost and
availability of debt to finance real estate acquisitions, which is a key component of our acquisition strategy. The lack of
available debt on reasonable terms or at all could result in a further reduction of suitable investment opportunities and
create a competitive advantage for other entities that have greater financial resources than we do. In addition, over the past
several years, a number of real estate funds and publicly traded and non-traded REITs have been formed and others have
been consolidated (and many such existing funds have grown in size) for the purpose of investing in real estate and real
estate-related assets. Additional real estate funds, vehicles and REITs with similar investment objectives are expected to be
formed in the future by other unrelated parties and further consolidations may occur (resulting in larger funds and
vehicles). Consequently, it is expected that competition for appropriate investment opportunities would reduce the number
of investment opportunities available to us and adversely affect the terms, including price, upon which investments can be
made. This competition may cause us to acquire properties and other investments at higher prices or by using less-thanideal capital structures, and in such case our returns will be lower and the value of our assets may not appreciate or may
decrease significantly below the amount we paid for such assets. If such events occur, you may experience a lower return
on your investment.
We make a substantial amount of joint venture investments with third parties and we may in the future do so with
Cohen & Steers affiliates. Joint venture investments could be adversely affected by our lack of sole decision-making
authority, our reliance on the financial condition of our joint venture partners and disputes between us and our joint
venture partners.
We partner with third parties (and we may in the future co-invest with Cohen & Steers affiliates) in partnerships or
other entities that own real estate properties, which we collectively refer to as joint ventures. Any joint venture with a
Cohen & Steers affiliate is permissible only if a majority of our Board, and a majority of the independent directors (or the
affiliate transaction committee, as a committee that is composed of each of our independent directors) not interested in the
transaction, approve the transaction as being fair and reasonable to us and on terms and conditions no less favorable to us
than those available from unaffiliated third parties. We intend generally to share responsibility for, or have control over,
managing the affairs of the joint venture, but may also acquire non-controlling interests in such entities. In either event, we
would not be in a position to exercise sole decision-making authority regarding the joint venture. Investments in joint
ventures may, under certain circumstances, involve risks not present were another party not involved, including the
possibility that joint venture partners might become bankrupt or fail to fund their required capital contributions. Joint
venture partners may have economic or other business interests or goals that are inconsistent with our business interests or
goals, and may be in a position to take actions contrary to our policies or objectives. Such investments may also have the
potential risk of impasses on decisions, such as a sale, because neither we nor the joint venture partner would have full
control over the joint venture. Disputes between us and joint venture partners may result in litigation or arbitration that
would increase our expenses and prevent our officers and directors from focusing their time and effort on our business.
Consequently, actions by or disputes with joint venture partners might result in subjecting properties owned by the joint
venture to additional risk. In addition, we may in certain circumstances be liable for the actions of our joint venture
partners.
23
