March 3, 2025

Multifamily construction capital will increase as investors become more realistic with long-term rates and lenders are recycling capital as loans mature. Regional and local banks have started to re-enter the space, which should continue as rates decrease. Although financing will be available, lenders will be more selective and there will be a higher cost of capital. Anticipate a flight to quality for strong projects and experienced sponsors. The biggest hurdle is not being able to make the numbers work in today’s market. Caution around overbuilding and concerns about rents will continue to keep some lenders at bay. More