2026 Multifamily Leadership Series: Jim Flynn, Lument

In the fourth year of Connect CRE’s annual Leadership Series, we focus on the apartment sector. We invited 18 multifamily heavyweights to provide their unfiltered views of the current market, its challenges and opportunities. The insights of these power players have been collected in a downloadable report, and we’re also presenting them individually, in alphabetical order. Here, Jim Flynn, CEO of Lument, provides insights.

Are the markets and products you’re investing in and developing changing? 

We’re always evaluating both markets and product mix, but our primary focus remains on the strength of the borrower and the underlying asset. Our recent addition of new production teams in the Pacific Northwest, Arizona, and Texas reflects a continued effort to deepen our national footprint and be closer to our clients, rather than a shift toward any single market dynamic. 

At the same time, borrowers’ needs have evolved. Today’s environment is more complex, and clients are looking for a broader range of financing solutions. Our response has been to develop a suite of offerings that go beyond agency and balance sheet bridge loans. Our Debt Capital Markets platform now provides access to a wide range of solutions across life company, CMBS, debt fund, credit union, and bank executions. We’re also continuing to heavily invest in expanding our investment sales platform. 

Has the debt market changed compared to a year ago, and if so, how? 

More than ever, borrowers are intent on maintaining flexibility. It is not uncertainty itself that concerns them; it’s the unexpected. Their goal is to preserve flexibility when the cost of being caught by an external shock (the pandemic or the war in Iran, for example) can upset their assumptions. As a result, they are looking for shorter terms, extension optionality, and prepayment flexibility. This is why five-year structures now represent a significant share of new Lument production. In 2025, for instance, five-year debt represented roughly a third of our production volume. Before the pandemic, we very rarely saw them. 

Absorption has increased this year. Is that due to a slowdown in development or other factors? 

The demand for apartments well outpaced supply during the post-pandemic construction surge. With rising costs moving home ownership out of reach even for well compensated young professionals, more people are turning to renting, particularly at the high end. While still positive, absorption has slowed down alongside a decreasing pace of deliveries—absorption hit 0.3% of occupied stock in Q1 2026 after averaging 0.9% for 2025. As the pace of construction continues to slow, I expect to see absorption follow suit as the market continues to tighten up. This is ultimately good news for occupancy and rent growth. 

Will we see an increase or decrease in rent prices this year? 

Rent growth was in the doldrums in 2025, but as absorption catches up with new supply, we expect it to gradually resume. Projections show roughly 2% national average rent growth in 2026, accelerating toward 3% by the end of 2027. 

That said, the national average masks significant variation at the market and asset level. AI and tech hubs like San Francisco and San Jose were among the leading metros for rent growth last year, particularly for high-amenity properties in urban, mixed-use environments. We’re seeing affluent tech-industry renters return to central business districts, much as they did before the pandemic. 

At the other end of the spectrum, rising gasoline and diesel prices are working their way through the economy, straining working-class household budgets even further. That is likely to limit the rent increases investors can achieve on Class B and C assets. 

A subsidiary of ORIX USA, New York-based Lument is a multifamily and commercial real estate lender offering agency, HUD/FHA and proprietary capital solutions. The firm closed more than $8.8 billion of debt across 550 deals in 2025 and ranks first among FHA MAP lenders by loan count. 

Click here to read the series.