The Gray Report Podcast Spencer Gray

As a historic wave of newly-built apartments continues beyond the one-year mark, elevated absorption numbers and data showing the first positive growth in occupancy in 2+ years are noteworthy signs of resilience in the apartment market. In the broader economy, lower jobs numbers and declining consumer credit suggest a pullback in consumer spending and (hopefully) lower inflation, but while consumers may balk at ever-pricier Big Macs or Frappuccinos, apartment housing is still in high demand.



Sources discussed in this episode:



RealPage: “Apartment Occupancy Ticks Up for the First Time Since Early 2022” - https://www.realpage.com/analytics/april-2024-data-update/



Yardi Matrix: “National Multifamily Report, April 2024” - https://www.yardimatrix.com/publications/download/file/5497-MatrixMultifamilyNationalReport-April2024



Reuters: “Weaker US jobs data soothes Fed worries of renewed overheating” - https://www.reuters.com/markets/us/weaker-us-jobs-data-brings-some-relief-fed-2024-05-03/



The Motley Fool: “Consumer Credit Oozes Up 0.4%” - https://www.fool.com/investing/general/2013/06/07/consumer-credit.aspx



Federal Reserve Bank of San Francisco: “Pandemic Savings Are Gone: What’s Next for U.S. Consumers?” - https://www.frbsf.org/research-and-insights/blog/sf-fed-blog/2024/05/03/pandemic-savings-are-gone-whats-next-for-us-consumers/



For the latest multifamily news from across the internet, visit the Gray Report website: ⁠https://www.grayreport.com/⁠



Sign up for our free multifamily newsletter here: ⁠https://www.graycapitalllc.com/newsletter⁠



DISCLAIMERS: This podcast does not constitute professional financial advice and is for educational/entertainment purposes only. This podcast is not an offer to invest. Any offering would be made through a private placement memorandum and would be limited to accredited investors.

With the Fed’s recent decision to keep rates at their current elevated levels, investors are facing a choice between increasingly positive multifamily fundamentals and an extended period of difficult financing.



CNBC: “Fed keeps rates steady as it notes ‘lack of further progress’ on inflation” - https://www.cnbc.com/2024/05/01/fed-rate-decision-may-2024-.html



Apartment List: “National Rent Report: ‘[G]rowth stalled out this month’” - https://www.apartmentlist.com/research/national-rent-data



CBRE: “The Past May Still Be Prologue in Multifamily Markets” - https://www.cbre.com/insights/briefs/motm-the-past-may-still-be-prologue-in-multifamily-markets



Pension Real Estate Association: “Compendium of Statistics” - https://www.prea.org/research/compendium/#:~:text=The%20Compendium%20of%20Statistics%20compiles,is%20available%20to%20members%20only.



RealPage: “Multifamily Starts Plunge in March, Indicating When Supply Wave Could Taper” - https://www.realpage.com/analytics/multifamily-starts-plunge-in-march-indicating-when-supply-wave-could-taper/



Cushman & Wakefield: Top Trends in the Multifamily Market: “Occupancies Are Holding Up Despite Record Deliveries” - https://www.cushmanwakefield.com/en/united-states/insights/top-trends-across-cw-multifamily-portfolio



Institutional Property Advisors: “Consumer Resilience Offers Benefits and Drawbacks for Commercial Real Estate” -

https://www.institutionalpropertyadvisors.com/research/special-report/2024/04/research-brief-april-gdp



For the latest multifamily news from across the internet, visit the Gray Report website: ⁠https://www.grayreport.com/⁠



Sign up for our free multifamily newsletter here: ⁠https://www.graycapitalllc.com/newsletter⁠



DISCLAIMERS: This video does not constitute professional financial advice and is for educational/entertainment purposes only. This video is not an offer to invest. Any offering would be made through a private placement memorandum and would be limited to accredited investors.

Multifamily investor sentiment improves even as debt financing challenges continue. Strength in the labor market, robust apartment demand, and stable consumer sentiment are some of the reasons behind this, but another significant factor is the decline in the multifamily construction pipeline.



NMHC: “Quarterly Survey of Apartment Conditions (April 2024)” - https://www.nmhc.org/research-insight/quarterly-survey/2024/nmhc-quarterly-survey-of-apartment-conditions-april-2024/



Fannie Mae: “Commercial-to-Residential Conversions: A Review of Existing Research” - https://www.fanniemae.com/media/51071/display



TheRealDeal: “Chavin surrenders Loop office-to-resi play with deed-in-lieu of foreclosure” - https://therealdeal.com/chicago/2024/04/23/intersection-drops-loop-office-conversion-with-deed-in-lieu/



Moody’s Analytics: “U.S. Consumers Remain Resilient but Blemishes Exist” - https://cre.moodysanalytics.com/insights/cre-news/u-s-consumers-remain-resilient-but-blemishes-exist/



For the latest multifamily news from across the internet, visit the Gray Report website: ⁠https://www.grayreport.com/⁠



Sign up for our free multifamily newsletter here: ⁠https://www.graycapitalllc.com/newsletter⁠



DISCLAIMERS: This podcast does not constitute professional financial advice and is for educational/entertainment purposes only. This podcast is not an offer to invest. Any offering would be made through a private placement memorandum and would be limited to accredited investors.

Comments this week from Federal Reserve Chair Jerome Powell are among the most forceful indications yet that interest rate cuts may be delayed past initial expectations. While some extreme predictions push the rate cuts all the way out to March 2025, futures data is pointing closer to September (at the moment). These shifting interest rate expectations may curb the activity of a CRE sales market that was just beginning to revive after a sluggish 2023, but strong housing demand and solid apartment fundamentals continue to attract investor attention in the multifamily market.



Reuters: “Blunt Powell signals rate cut plans on ice” - https://www.reuters.com/markets/us/global-markets-view-usa-2024-04-17/



Bloomberg: “Vanguard Warns 10-Year Treasury Yields Risk Jump Back to 5%” - https://www.bloomberg.com/news/articles/2024-04-18/treasuries-vanguard-warns-10-year-yields-risk-spiking-back-to-5



CME Group: "FedWatch Tool" - https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html



RealPage: “U.S. Marks Largest Volume of Quarterly Apartment Supply in History” - https://www.realpage.com/analytics/1st-quarter-supply-highest-ever/



RealPage: “Putting 1st Quarter 2024 Apartment Demand in Perspective” - https://www.realpage.com/analytics/perspective-us-apartment-demand-1st-quarter/



For the latest multifamily news from across the internet, visit the Gray Report website: ⁠https://www.grayreport.com/⁠



Sign up for our free multifamily newsletter here: ⁠https://www.graycapitalllc.com/newsletter⁠



DISCLAIMERS: This video does not constitute professional financial advice and is for educational/entertainment purposes only. This video is not an offer to invest. Any offering would be made through a private placement memorandum and would be limited to accredited investors.

A 3.5% annual jump in CPI inflation numbers has led investors and experts to rethink their expectations of an interest rate cut in mid-year 2024, but Blackstone's recent agreement to acquire Apartment Income REIT Corp. for $10 billion could spark greater investment activity in spite of elevated interest rates, especially given the improving fundamentals in the apartment market.

Sources discussed in this episode:

CPI: “Consumer Price Index, March 2024” - https://www.bls.gov/news.release/cpi.nr0.htm

The Wall Street Journal: “Blackstone Making $10 Billion Multifamily Purchase, Going on the Real Estate Offensive” - https://www.wsj.com/real-estate/blackstone-making-10-billion-multifamily-purchase-going-on-the-real-estate-offensive-f3126928

Yardi Matrix: “Multifamily Sets Strong Early Tone in 2024” - https://www.yardimatrix.com/publications/download/file/5355-MatrixMultifamilyNationalReport-March2024

RealPage: “RealPage Slightly Strengthens Forecast in Most Apartment Markets Based on Economic Indicators” - https://www.realpage.com/analytics/1q24-foreast-update/

For the latest multifamily news from across the internet, visit the Gray Report website: ⁠https://www.grayreport.com/⁠

Sign up for our free multifamily newsletter here: ⁠https://www.graycapitalllc.com/newsletter⁠

Learn more about Gray Capital's latest multifamily investment offering for accredited investors: https://www.graycapitalllc.com/new-offering/

DISCLAIMERS: This podcast does not constitute professional financial advice and is for educational/entertainment purposes only. This podcast is not an offer to invest. Any offering would be made through a private placement memorandum and would be limited to accredited investors.

Sources discussed in this episode:



Moody’s Analytics: “Q1 2024 Preliminary Trend Announcement” - https://cre.moodysanalytics.com/insights/cre-trends/q1-2024-preliminary-trend-announcement/



The Conference Board: "U.S. Leading Economic Index" - https://www.conference-board.org/topics/us-leading-indicators



The Wall Street Journal: "What's Wrong with the Economy? It's You, Not the Data" - https://www.wsj.com/economy/consumers/whats-wrong-with-the-economy-its-you-not-the-data-cfa911e6



Bureau of Labor Statistics: "The Employment Situation - March 2024" - https://www.bls.gov/news.release/empsit.nr0.htm



Apartment List: “March 2024 Rent Report” - https://www.apartmentlist.com/research/national-rent-data



CBRE: “Made in the Midwest” - https://www.cbre.com/insights/reports/made-in-the-midwest



For the latest multifamily news from across the internet, visit the Gray Report website: ⁠https://www.grayreport.com/⁠



Sign up for our free multifamily newsletter here: ⁠https://www.graycapitalllc.com/newsletter⁠



Learn more about Gray Capital's latest multifamily investment offering for accredited investors: https://www.graycapitalllc.com/new-offering/



DISCLAIMERS: This video does not constitute professional financial advice and is for educational/entertainment purposes only. This video is not an offer to invest. Any offering would be made through a private placement memorandum and would be limited to accredited investors.