Mixed Signals in the Economy: What it Means for Real Estate Investors
We continue to get mixed messages about the state of the U.S. economy. On one hand, the Federal Reserve lowered the Fed funds rate by 25 basis points this month and signaled the potential for further cuts. Current expectations are for as many as three more 25-basis-point reductions before year-end. Unsurprisingly, many real estate investors […]
Is Oil Telling Us a Recession is Coming?
One of the most reliable early-warning indicators of economic trouble is falling oil demand—and right now, that signal is flashing yellow. As passive real estate investors, we may not trade commodities or watch energy markets closely. But oil is a core input to nearly every economic activity—from shipping and trucking to manufacturing and travel. When […]
Economic signals point to lower rates ahead
The last 12 months have been tough for commercial real estate investors. Many major markets have seen declining fundamentals and transition into the recession stage of the real estate cycle, as oversupply has driven vacancy, concessions, and declining rents. In the wake of higher interest rates and declining fundamentals, transaction volume remains at its lowest […]
No signs of interest rates reducing
Some syndicators will be waving banners this week shouting out that 100% bonus depreciation is back. It’s true, that if the Senate passes Trump’s “big beautiful bill”, bonus depreciation will be back and that may be a boon for Limited Partner investors and the capital raisers who seek to attract them. However the broader macroeconomic […]
HVAC Maintenance Costs Set to Impact Multifamily Investment Returns
We often write about macroeconomic factors impacting multifamily investments. This month, we want to highlight an important change to HVAC maintenance, that is going to increase operational costs across the multifamily industry. This is an example of how detailed knowledge of operations and maintenance is essential for investors and operators of multifamily properties, and how […]
Reading the Signals: What’s Really Pressuring the Multifamily Sector Right Now
We’re dealing with a pretty unusual mix of political, labor, and economic signals at the moment. It’s been a challenging environment to read, but a few key patterns are starting to emerge. Here’s a quick breakdown of the themes we’re watching most closely. Political Pressure Is Starting to Reshape Demand and Labor Immigration has been […]
Underwriting in an Uncertain World
A number of factors continue to make it difficult to underwrite with certainty and find value in the current market. The Fed kept rates flat this month, based on the notion that inflation has settled in the 2.4% to 2.9% range. However, the long end of the yield curve remains elevated at 5.%, and suggests […]
Our 2025 Multifamily Outlook
It has been a rough couple years for multifamily investors in the wake to the Covid black swan, but 2025 is shaping up for the battered asset class to take revenge, and showcase its innate recession resistance, and once again provide investors with stable yield and long term growth.
Buy every deal that cashflows. Buy quality, late-model product, in good markets. Don’t over leverage and be aware of your prepayment penalties. Rates will come down; the new supply will get absorbed. Demand for rental housing will increase, driving rent growth. And demand for multifamily investments will increase, driving investment returns.
What Distinguishes Great Real Estate Investments
Great Real Estate Investments are distinguished by a detailed and multifaceted approach. Informed decisions lead to successful and profitable investments.
Best Practice to Vet a Real Estate Operator
We are in an environment at the moment, where many investments are under-performing. In some cases, this may be because of market timing and circumstances – interest rates and inflation spiked much faster than anyone would have predicted, and even the most experienced of operators would have seen impacts from these macro trends.
In other cases, underperformance may stem from poor operations, inexperienced operators, or worse still, fraud and misconduct.
Amongst this backdrop, we have been having many conversations with investors lately on the topic of vetting investments and vetting operators. Based on these conversations, we thought it may be useful to provide a summary of best practices to ensure that you partner with a reliable and competent operator.