What are Class B Apartments?

Class B multi-family buildings provide the most potential value for investors and the chance to improve communities. I am going to tell you why I believe this.
Commercial real estate asset classes are used to group investments with similar characteristics and that tend to behave similarly in the market.
If Class A properties are the highest quality building in a market or area, Class B is one tier lower. These represent properties that are generally older by definition, and there could be some deferred maintenance issues. Class B properties most likely have great “bones” but may have suffered some neglect. Maintenance costs are going to be higher on Class B properties in contrast to Class A.
These properties are considered riskier than Class A but I would argue there is less likely to be an inflated price premium that I would associate with Class A buildings. I’ve seen analysis that states class B multifamily provide the highest risk-adjusted return because of the opportunity to fix problems and deficiencies, optimize operations, and then profit from that added value. It will be important to make sure class B properties are in good areas with strong demand for housing. In general they are well-maintained, and the properties have the potential to be upgraded to become Class B+ or Class A properties through renovations and improvements.
Class B properties may be considered speculative investments. National investors may avoid them so the investors holding them are more likely to be local.
To summarize, Class B Multi Family Apartment buildings are a great investment to consider. I believe they are the optime balance between risk and reward. I like the idea of having something I can fix up, improve, modernize, and reap a healthy profit. Class B Buildings offer the opportunity to improve the community and give people a safe and good place to live and thrive.
Works Cited:
https://www.realtymogul.com/knowledge-center/article/what-is-class-a-class-b-or-class-c-property
https://gowercrowd.com/real-estate-investing/class-a-b-c-properties
https://willowdaleequity.com/blog/class-b-multifamily-and-the-two-other-asset-classifications/