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Given the dramatic move we’ve seen in interest rates in recent weeks, I thought it was important to revisit some of my own assumptions around how my chosen strategy, value-add multifamily real estate, might be affected. There’s no better way for me to organize my thoughts than through writing and sharing, so here goes. There’s … Read more

Investing in private equity real estate and publicly traded stocks are similar. How do I know? I’ve invested in more than 2,000 apartment units following a 25+ year professional career in institutional equities (stocks).   It turns out, the valuation framework, tools, and basic skills required to analyze businesses apply to stocks and real estate. Experience … Read more

In the early days of the pandemic, pundits broadly agreed that everybody would flee the cities in favor of suburban single-family homes. Preferences aside, that never seemed to be a realistic outcome. In August, I wrote a blog post, Risks to Class B/C Multifamily Investing, on this topic, arguing as follows: Supply constraints make an apartment exodus impossible … Read more

Freddie Mac recently published an excellent report called US Population Growth: Where is Housing Demand Strongest? Similar reports underscore the growth in sunbelt states and highlight the MSAs that are growing fastest. The report highlights that US population growth is slowing. Therefore, real estate investors must focus more carefully on the composition of growth drivers (net migration … Read more

What’s the right allocation to private equity real estate? The honest answer, as ever, is that it depends. It mostly depends on the individual’s risk tolerance, objectives, existing portfolio, and other tax, liquidity, and estate planning considerations. It also depends on what you mean by real estate, which can take many forms and carry a … Read more

Earlier in the week, I read a thought-provoking year-ahead strategy piece by KKR’s Henry McVey. In the note, called 2021: Another Voice, McVey shares a reasonably bullish outlook on the global macroeconomic landscape. I couldn’t tell you his 2021 year-end price target for the S&P 500, but I appreciated his framework and the way he … Read more

In our recent post, “Fears of An Apartment Exodus” we shared our views around the significant shortage of affordable housing in this country and why it’s unlikely that “everyone” will leave their apartments in the city for a single-family home in the suburbs. Supply constraints make an apartment exodus impossible in practice – we can’t … Read more

As enhanced unemployment benefits have now expired, we’ll continue to closely monitor delinquency trends across our portfolio. There are a lot of dramatic headlines out there, and not just from attention-seeking press outlets. For example, the most recent Household Pulse Survey from the US Census Bureau showed that just over 1/3 (34%) of respondents nationally … Read more

Over the past month, there’s been no shortage of articles in the popular press describing how COVID has affected consumer’s housing preferences. Broadly speaking, the narrative describes a rush from apartments in the city to single-family homes in the suburbs. Taken to the extreme, a major shift in demand trends would present problems to apartment … Read more

We and our partners have remained intensely focused on operations and tenant engagement since early March. For now, our on-site property management teams have done a great job navigating the operational challenges of COVID. We’ve found ways to manage work requests, rent collections, and leasing engagement within the constraints of social distancing. According to the … Read more