Klaus Vedfelt Leverage is one of the most misunderstood concepts in finance. Investors have a tendency to view debt on balance sheets as the sword of Damocles, hanging overhead by a single hair. Negative perceptions of leverage in real estate spawned in the Financial Crisis as dozens of REITs had to turn keys over to banks when debt overwhelmed them. Fear of leverage has persisted and to this day, low-debt REITs trade at substantial premiums over higher-debt REITs. There is certainly truth to the idea that ...