INSIGHTS
MULTIFAMILY
We believe multifamily real estate continues to be one of the most dependable and resilient asset classes—regardless of broader market conditions.
Even during economic downturns, people still need a safe, comfortable place to call home. In past recessions, including the 2008–2009 financial crisis, we saw only modest declines in occupancy—around 1.0% to 2.6%—particularly in Class B and C communities. This stability reflects the essential nature of housing and the continued demand for well-located, affordably priced rental options.
While the COVID-19 pandemic disrupted many sectors of real estate, multifamily demonstrated notable resilience. Class A properties in urban cores experienced some short-term volatility, but suburban and workforce housing—particularly in Class B and C assets—remained in high demand. These segments benefitted from renters seeking more space, affordability, and long-term stability, especially in high-growth markets like Texas and the Southeast.
OUR INVESTMENT RATIONALE
Every opportunity is guided by a strong emphasis on economic and demographic trends, as well as careful analysis of supply and demand fundamentals. Strategic acquisitions are made based on a disciplined investment criteria focused on long-term value.
The focus is on acquiring tangible, income-producing assets that offer attractive risk-adjusted returns. Whether targeting high cash-flowing properties, assets with inherent land value and downside protection, or those with rent growth potential, the goal remains the same: to deliver consistent, favorable returns for investors across all market environments.
Income Inequality and Cost‐of‐Living Pressures
Surging Liquidity & Shifting Investor Confidence
As income inequality widens and the cost burden on the lower-middle class grows, more households are pushed to seek out affordable housing solutions. This shift has driven up demand for value-add multifamily assets (Class B and C), where strategic repositioning can deliver both quality homes at accessible rents and attractive investor returns.
At the same time, living expenses continue to soar—particularly in high-tax, high-cost coastal markets—prompting a wave of relocation to states and cities with lower taxes, business-friendly policies, and overall more manageable costs. These migration trends reinforce the appeal of emerging markets and underscore the opportunity in well-positioned value-add properties.
M2 money supply in the U.S. has expanded significantly, flooding the market with capital from pension funds, endowments, insurance companies, private equity and venture funds, family offices, and more. That surge in liquidity—coupled with persistently low borrowing costs—has driven intense competition for a shrinking pool of high-quality opportunities, resulting in yield compression across traditional asset classes (equities, bonds, real estate, private debt, and beyond).
At the same time, growing investor skepticism toward conventional vehicles—stocks, bonds, ETFs, REITs—has spurred a shift into alternative strategies. Multifamily real estate stands out for its stability: it offers predictable cash flows, built-in rent escalations, and an effective hedge against inflation. As a result, demand for well-positioned value-add properties continues to outpace supply and is poised to remain strong.
Home Ownership Trends
Homeownership rates have hovered near two-decade lows—around 63–65%—while rental demand remains on an upward trajectory. Tighter underwriting standards, elevated mortgage rates, and record-high home prices are increasingly shutting out first-time buyers and lower-middle-income households, driving more Americans toward the rental market.
At the same time, Millennials—and now an emerging Gen Z cohort—are postponing or forgoing homeownership in favor of the flexibility and conveniences offered by multifamily living. Tech- and amenity-driven urban and Sun Belt markets like Houston, Dallas, and Austin continue to attract mobile, career-focused renters, even as homebuilders pull back on new starts amid supply-chain strains and economic uncertainty—further constraining for-sale inventory and reinforcing the case for multifamily investment.