At Connect Apartments 2026, Experts See “Generational Buying Opportunities”

Against a backdrop of high interest rates, inflation and the conflict in Iran, the “tale of two markets” scenario that began in the post-pandemic office sector now encompasses multifamily, Trepp’s Lonnie Hendry told the audience at Connect Apartments 2026 in Los Angeles. Not only is the have/have-not dichotomy market-specific, he added, “you could have two apartment buildings on the same street with completely different outcomes, depending on the debt stack and who the operator is.”

Looking at multifamily relative to other asset classes, “it’s still performing exceptionally well,” said Hendry, chief product officer at Trepp. However, he pointed out, “there’s definitely a lot of properties underwater.”

Hendry, Brighton Capital Advisors managing partner Michael Cohen and LaTerra Development managing director Chris Tourtellotte provided insights for the conference’s “Capital Markets & Investment Strategy: Where the Money is Moving” discussion. Continuing a point raised by Hendry, Cohen said, “I started in CMBS in 1991 and have been through many cycles of this. This one is unique because there’s capital available to buy and the lenders have money.

“The issue here on multifamily is almost 100% leverage,” he continued. “If you bought between 2017 and 2023, you’re over-leveraged.”‘

Lenders are not forcing borrowers’ hand at this point, said Cohen. “However, they are taking control. They are getting more aggressive. They are starting to put receivers in place. They are looking for any of your personal recourse carve-outs.”

Asked by moderator Bryan Doyle, COO, Americas capital markets at Cushman & Wakefield, whether his company is still pursuing deals, Tourtellotte said yes. The challenge right now, he pointed out, is in finding buying opportunities.

“What we’re seeing today is capital wanting to buy existing assets,” he said. Often, those properties are new construction that is selling at or near the loan balance.

“Obviously, you don’t want to be a seller today,” said Tourtellotte. “But I think there’s some generational buying opportunities.” The challenge, though, is in finding deals that can meet equity partners’ return expectations.