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Good morning. Multifamily fundamentals remained intact in April, but cracks in occupancy and capital markets suggest the road ahead may be less stable. Regional performance is diverging as supply and sentiment shift.

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Market Snapshot

*Data as of 05/7/2025 market close.

mixed signals

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• Lavish lies: Disgraced developer Josh Schuster was indicted for defrauding investors of over $10M in a “Ponzi-like” real estate scheme, spending the funds on luxury living.

• Neumann returns: Adam Neumann’s Flow and Canada Global scored approval for a 675-unit, three-tower mixed-use project in Aventura.

• Debt debut: Invesco’s real estate REIT, INCREF, launched its first $1.2B CRE CLO backed by multifamily and industrial loans, marking the largest diversified issuance of its kind in three years despite market volatility. 

• Growth signals: Commercial property values in the US turned a corner in Q125, with the NCREIF Property Index showing its first appreciation gain since mid-2022.

• Tiny trend: Micro housing is gaining traction in high-cost cities, with units under 441 square feet now making up a growing share of new rental stock.

• Queens commitment: Tredway has acquired the 602-unit Ocean Park Apartments in Far Rockaway, Queens, for $88M, securing long-term affordability through a new regulatory agreement.

• Reprieve without relief: Florida lawmakers extended deadlines for safety inspections and reserve funding requirements, but condo owners are still facing soaring costs and plunging values.

• Milwaukee moves: PPR Capital Management made its Upper Midwest debut with the $38.3M acquisition of The Villas at Foxwood, a 232-unit townhome-style multifamily property near Milwaukee.

• Infill expansion: Bain Capital, in partnership with Oliver Street Capital, acquired 11 Class B warehouses in NJ for $208M from Blackstone.

• Digital gridlock: As AI drives massive electricity demand, the Trump administration’s rollback of renewable energy policies is straining US data center growth.

• Supply chain stress: Wall Street is tracking shipping and freight data to assess the economic fallout of Trump’s new tariffs, as plunging imports, canceled shipments, and slumping trucking orders indicate early signs of a potential slowdown. 

• Tenant-driven turnaround: Industrial leasing surged in NYC’s outer boroughs during Q125, with a 16.4% rise in activity led by mid-sized deals.

• Fire sale: Rite Aid is putting 1,245 stores on the market following its second bankruptcy in two years, creating a retail real estate ripple across major US markets. 

• Retail resilience: Despite a slight uptick in vacancies from store closures and bankruptcies, San Diego’s retail market remains stable in early 2025, buoyed by limited new supply and steady leasing. 

• Anchorless and empty: The San Francisco Centre continues its retail exodus with three more store closures ahead of a $625.6M lien auction. 

• Steady shelter: In a market clouded by tariffs, rate volatility, and economic uncertainty, TPG Angelo Gordon’s Gordon Whiting says net lease investments remain a bright spot.

• High-rise hopes: Related California is moving forward with a $600M, 41-story office and hotel tower in San Francisco's North Financial District, betting on high-end demand despite the city’s broader office vacancy woes. 

• Flagship fallout: Ross sold its downtown San Francisco headquarters and flagship store at a 68% loss, reflecting continued distress in the city’s office market. 

• Coworking comeback: Workbox is taking over 68 KSF in Chicago’s distressed Civic Opera House, marking its largest location yet and signaling renewed coworking demand.

• Marketing mainstay: Situation Group has signed a nine-year renewal for its 17 KSF Midtown office at 469 Seventh Avenue, keeping the building fully occupied.

• Capex freeze: Wynn Resorts has paused $375M in US capital projects, including a major remodel of its Encore Tower in Las Vegas.

• Expansion amid uncertainty: IHG Hotels & Resorts opened 86 hotels in Q125 and maintained its full-year profit outlook, even as peers trimmed forecasts.

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📈 CHART OF THE DAY