Why is a higher cap rate riskier?

Because the cap rate is the return buyers demand for holding a property's income, and they demand more where the income is less certain. A high cap rate means the market has priced in more vacancy, more repairs, weaker tenants or slower growth. The extra yield is payment for that risk.

Safe, appreciating property in strong locations attracts competing buyers who bid the price up and the cap rate down. Older property in weaker areas attracts fewer buyers, who require more income per dollar of price before they step in.

A 10% cap rate usually comes with higher turnover, larger maintenance loads, collection problems and little appreciation. A 4% cap rate comes with the opposite. The question is whether the extra yield covers the extra risk, and whether the expenses behind the high cap rate were realistic.