August 2025

The latest newsletter reports the closing of a $10.175M asset in Chico, CA, consisting of 72 senior units, secured with a 5.33% interest-only loan for 10 years, and exceeding 5.5% cash-on-cash returns from the start. The newsletter also invites those with equity to consider exchanging or investing in new projects, mentioning a current $18.5M property under due diligence in Iowa. Economically, the U.S. multifamily market is entering a new cycle in the latter half of 2025, showing solid fundamentals despite macroeconomic uncertainty. Key indicators for July include a 0.2% increase in the all-items CPI (2.7% year-over-year), a 0.3% rise in core CPI (3.1% year-over-year), and a significant 0.9% jump in the PPI (3.3% annual growth). Interest rates have been steady in 2025, making transactions challenging. The multifamily sector expects stabilization, with the national vacancy rate projected to drop to 6.0% by year-end 2025, effective rent growth projected between 2.0% and 2.5% for the full year, and construction starts slowing. Investment activity has returned to pre-pandemic levels, with average cap rates stable at 5.7%.