Multifamily Investment Pulls Back in Orange County

Multifamily Investment Slows

Orange County’s multifamily sector saw investment activity sharply cut to $197.8M in the first quarter of 2026, down from $452.3M the previous quarter. According to Globe St, CBRE attributed the decline to smaller average deal sizes. The largest transaction—a 245-unit community in Garden Grove—sold for $84M to an undisclosed buyer, followed by a 68-unit Brea property acquired by Dunbar RE Investments for $27.25M, and a 37-unit deal in Costa Mesa by Mahdek Property Partners for $14.25M.

Occupancy and Absorption Trends

Absorption slowed notably, with only 371 units absorbed compared to 940 in Q4 2025. Occupancy slipped by 10 basis points to 96.1% as recently delivered units remained vacant. Despite the drop, leasing demand stayed positive, indicating ongoing renter interest in the multifamily segment.

Development and Rent Performance

New multifamily supply dwindled, with just 461 units delivered in Q1 2026, down from 1,642 units at the end of 2025. CBRE cited economic challenges and escalating construction costs as key factors behind the decline in development. Rents were steady, averaging $2,896, while nearby markets have already seen rent levels soften further as supply pressures and affordability constraints weigh on pricing power across the region.