Impact Growth Capital Newsletter

 This week at IGC:
Multifamily Market Surges - Private Wealth Drives $1.5 Trillion

Real Time Market Snapshot

Data as of 4/30/2025

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Economics

Multifamily Market Surges as Inventory Nears 20 Million Units

The U.S. multifamily sector is experiencing a significant surge, with national inventory nearing 20 million units—a 2.9% year-over-year increase driven by the addition of 577,000 new units. This growth is fueled by record-setting demand and absorption, as net absorption over the past 12 months surpassed 707,000 units—more than double the previous year’s total. Occupancy has risen 90 basis points to 95%, supported by nearly 900,000 new household formations and continued employment growth, which added 1.9 million jobs (a 1.2% increase). Effective rents saw a modest rise of 1.1% to $1,827 nationally, indicating stable revenue fundamentals despite pockets of softening.

Markets such as New York City and Washington, D.C. saw occupancy rise to 97.4% and 95.8% respectively, with strong absorption figures. Orlando absorbed more units than were delivered, lifting occupancy to 94.4% despite a 4.5% increase in inventory. Dallas saw over 48,200 units absorbed—outpacing its 43,100 new units—even as effective rents declined slightly by 2.1%. This signals continued strength in core urban markets, as well as opportunities in Sunbelt metros where demand remains solid. Furthermore, with a widening gap between Class A and Class C rents ($2,400 vs. $1,500), there’s rising interest in value-add strategies and workforce housing segments.

Private Capital

Private Wealth Drives $1.5 Trillion in Global CRE

Private wealth investors are increasingly adopting institutional strategies in commercial real estate, marking a significant shift in the investment landscape. According to JLL's Private Wealth Tracker 2025, high-net-worth individuals, family offices, and privately owned businesses are now bringing a level of professionalism and diversification that rivals—and often surpasses—their institutional counterparts. This evolution has led to private wealth being involved in more than $1.5 trillion in direct CRE deals globally over the past decade, with the Americas capturing 42% of that capital, followed by EMEA at 37% and Asia Pacific at 21%.

The United States leads as both the top source and destination of private capital, accounting for $604 billion in inbound investment and $557 billion in outbound capital between 2013 and 2024. Other significant destinations include the U.K. ($155 billion), Germany ($114 billion), and Australia ($91 billion). Top cities attracting this capital are London, Hong Kong, New York, Tokyo, Los Angeles, and Sydney. In terms of asset allocation, private investors favor office properties (30%), followed by residential (24%), retail (18%), industrial/logistics (12%), hotels (11%), and alternatives (4%). This trend underscores a growing sophistication among private investors, who are now operating at a scale and strategic understanding that was not always present in the past.​