text: **PART VIII**
  
  **Risk Management**
  Killam faces a variety of risks, the majority of which are common to real estate entities. Real estate investments are generally subject to varying 
  degrees of risk, depending on the nature of the property. These risks include (i) changes in general economic conditions, (ii) changes in local 
  conditions (such as an oversupply of space or a reduction in demand for real estate in the area), (iii) changes to government regulations (such as 
  new or revised residential tenant legislations), (iv) competition from others with available space, and (v) the ability of the landlord or owner to 
  provide adequate maintenance economically. 
  
  Real estate is relatively illiquid. Such illiquidity will tend to limit Killam’s ability to rebalance its portfolio promptly in response to changing 
  economic or investment conditions. In addition, financial difficulties of other property owners, resulting in distress sales, may depress real estate 
  values in the markets in which the company operates. 
  
  Killam’s exposure to general risks associated with real estate investments is mitigated with both its geographic diversification, and investments in 
  both apartments and mHcs. 
  
  Killam is exposed to other risks, as outlined below: 
  
  **Interest Rate Risk**
  Interest risk is the risk that the Company would experience lower returns as the result of its exposure to a higher interest rate environment. The 
  Company is exposed to interest rate risk as a result of its mortgages and loans payable, however this risk is mitigated through the Company’s 
  strategy to have the majority of its mortgages payable in fixed‑term arrangements. The Company also structures its financings so as to stagger 
  the maturities of its debt, minimizing the Company’s exposure to interest rates in any one year. 