Going into timber could also be an option for you and that too can be mitigated with a 1031. 

Especially if, after seeing the pallets, the tenant placed items directly on the floor.There may well be some way to mitigate the problem. 

I don't see anyway to mitigate or lessen this risk.  

The article is 100% correct, I've worked at 2 National REIT and the diversification of a REIT can't be compared to the small scale investing we do.A REIT can have Large scale Apartment complexes 500 Units or larger, Large Office buildings or Office parks consisting several office buildings, Hospitals, Land, Industrial Wharehouses, Hotels, Large Shopping centers, and they also have strategic components factored into the REIT to mitigate losses based on changes in market conditions or asset types.I can't begin to count the number of inexperienced flippers that forget to factor in something as simple as taxes on sales when they're doing the numbers to acquire a property causing them to have a loss on a deal.

I have seen many properties in NE get better rates than originally thought and I am guessing that this is because NE has done a good job on flood mitigation. 

Smaller spaces where a Radio Shack and Metro PCS stores closed were vacant for most of a year each.I think it's important to have a larger number of smaller renters, vs a more big renters in order to mitigate the risk of too many eggs in one basket.Good luck!

She trusts us, but ways we can mitigate risk for them will probably be really good. 

It allows you to have less of your money in a deal which is a mitigator between you and and a potential lawsuit. 

OR, maybe NYC will spend a lot of money to mitigate the effects of climate change which could help for another 10 years.I'm also going to start buying in other States after I get reciprocity for my Broker's License, concentrating on Cities that can be least affected by climate change.The point is that I'm prepared to do what's necessary but have an eye on the future.So far, I have been right for the last 2 decades while I kept on hearing "What are you crazy?

While a regular exchange may cost you $700 or so, an improvement exchange can add 3-5K to that making it cost prohibitive.Your plan to sell one appreciated and buy two fixers can help mitigate a little.