Which of the following factors is NOT a consideration in determining the cap rates for real estate properties?

Determining cap rates for real estate properties involves assessing various elements that can influence a property’s value and investment potential. The correct choice focuses on factors that are typically not directly tied to the specific financial performance of a property.

While local government regulations can affect markets broadly, they are often considered less relevant in the specific, immediate calculations of cap rates compared to the other factors listed. Typically, cap rates primarily reflect the investment's income potential relative to its purchase price, which is why elements such as transit accessibility, building age, design, and quality, as well as lease agreement covenants and conditions are more directly pertinent.

Transit accessibility can significantly impact a property's desirability and, therefore, its potential income. The age, design, and quality of a building also directly influence maintenance costs and tenant appeal, affecting rental rates. Moreover, lease agreements play a crucial role in defining the income stream a property can generate. Consequently, while local government regulations can shape the investment environment, they do not have the same immediate impact on the valuation metrics that cap rates represent.