Which factor does NOT contribute to the risk of investing in unimproved land?

The reason that "no management costs" is identified as the correct choice is that it highlights an absence of a typical risk factor associated with unimproved land investments. When investing in unimproved land, one of the main advantages can be the lower ongoing operational expenses compared to developed properties, where management costs such as maintenance, property taxes, and utilities can significantly affect profitability. Therefore, the absence of management costs suggests that the investment is less encumbered by recurring expenses, which could otherwise contribute to the overall risk profile.

In contrast, high management costs, market volatility, and location uncertainty are all factors that do contribute to the risk of investing in unimproved land. High management costs can lead to diminished returns, market volatility can affect the potential resale value of the land and create unpredictability in investment returns, and location uncertainty can impact the desirability and future appreciation of the property. These elements collectively create a more complicated investment landscape compared to scenarios where management costs are minimal or nonexistent.