Definition:

A real estate property categorization, or investment “style,” referring to properties requiring some degree of improvements in order to gain increased returns. “Value-add” generally refers to a property that is currently in less than stellar condition and in need of improvements that are of somewhat higher risk, such as performing more-than-usual renovations like upgrading exteriors and interiors and curing deferred maintenance. The “value-add” categorization implies higher risk than the category of “core plus,” but less than “opportunistic.” Returns on the properties will be driven both by current income and by expected capital appreciation.

Example:

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