CRE Resilience, or Calm before the Storm?

Wide-ranging tariffs have just been enacted by the Trump administration, but commercial real estate—multifamily included—remains remarkably steady. This steady performance, however, could mean that 2025 rent growth continues the lower-than-average trends from 2024, but given the slowdown in apartment construction and the anticipated drop in new multifamily supply in 2026, owners and investors with a long-term strategy could see some significant opportunities emerge in this transitionary period.

Multifamily, the Nation, and the Economy

Multifamily and the Housing Market

Mortgage Rates Expected to Fall Further, Spurring Slight Uptick in Housing Activity

Fannie Mae: “Our multifamily housing starts forecast was mostly unchanged in the near term but revised slightly downward in 2026. Slow rent growth and nearly 1 million multifamily units already under construction continue to suggest multifamily construction will be subdued this year.”

Multifamily Markets and Reports

Breaking Down New Population Growth Data from the Census

Cushman & Wakefield: “Nationally, U.S. population growth was the largest in more than 20 years, growing at 1% last year. Most of this growth came from international migration, particularly in the 62 metros with more than 1 million people. Cumulatively, these metros added about 2.2 million people, with 2.1 million—96% of the total—coming from international migration.”

Commercial Real Estate and the Macro Economy

March 2025 CRE Report: Debt and Delinquencies Are Growing

Via NAR: “[D]elinquency rates for commercial real estate loans increased to 1.57% in Q4 2024 . . . [H]istorically, commercial loan delinquencies have hovered near 1% over the past decade, while residential delinquencies averaged closer to 3%. So, the recent narrowing of this gap suggests that commercial real estate is now facing more pressure than in prior years.”

Other Real Estate News and Reports

National CRE Report: “Multifamily multifamily real estate sector is poised for a growth year”

Via Crexi: Tariff-driven construction cost increases “may result in elevated rents, as developers might pass on expenses to tenants or delay projects, exacerbating housing affordability issues. Despite these hurdles, the multifamily market is expected to stabilize toward the end of 2025.”

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