release edition [082] read time [9 minutes] Welcome to The Multifamily Download, a weekly newsletter where I provide institutional insights to help you build an exceptional Multifamily career. Forwarded this email? Subscribe here. Today at a Glance:
Coming SoonAs I've shared over the past few weeks, I've been building a software the combines all of the underwriting capabilities that I wished I had when I was focused on sourcing and underwriting. The result is a comprehensive multifamily acquisitions platform that combines the best of two worlds: institutional rigor and entrepreneurial speed. The live beta group is wrapping up, and I'm excited to open it publicly very soon. This will not be available to everyone at once. Early access will go to the waitlist first to claim Founding Member pricing before it opens up to the public.
This software combines institutional discipline, an entrepreneurial edge, and distinct AI-capabilities. This software is not an AI model, but rather it is a structured and deterministic engine that generates consistent and dependable outputs. Shown below is the new deal underwriting dashboard, complete with a six-stage deal progress tracker, deal assumption panels, command center scenario navigation, scenario testing and comparison, live sharing, presentation mode, and more. The next time you hear about this, it will have a name, and it will have been made available to the waitlist, so the Founding Member spots and pricing may no longer be available. If you're on the fence, I'd encourage you to join the waitlist now. p.s. I still haven't found another self-serve platform that does what this product does at the price I'm going to offer it. If you underwrite Multifamily deals, you won't want to miss this. Join the waitlist here. BlackRock's $1.6B BetThis week BlackRock agreed to buy 11 apartment communities from Camden Property Trust for $1.63 billion. This equates to 3,620 units across Los Angeles, Orange, Riverside, and San Diego counties, at roughly $450,000 a door and about 96% occupancy. It's the largest single U.S. multifamily trade since June 2024, and by unit count it's something like a sixth of everything that normally trades in Southern California in a full year, done in one deal, according to JLL which brokered the transaction (congrats Blake & team if you're reading this!) There are two sides of this transaction, and they speak volumes about where we are in the cycle. Camden, a Houston-based REIT, is selling out of coastal California and has signaled it will use the proceeds to buy back its own stock. BlackRock, sitting on a mountain of dry powder, is paying $1.6 billion to own supply-constrained coastal apartments at a basis below what it would cost to build these today. One side thinks its own shares are the better buy and the other thinks the assets are the better buy. This aligns with what I've been writing since the mid-year scorecard in TMD 076. Once fundamentals begin to broaden and a few big trades actually close, capital will flow back to the sector in a meaningful way. This is one of those trades. It rhymes with the AvalonBay and Equity Residential merger (now called Vivmark) that I covered last week in TMD 081, where two of the largest operators in the country made a high-conviction bet on scaling into a unified platform to gain operational leverage over their assets that are primarily in gateway, supply-constrained markets. It's worth paying attention when BlackRock and the biggest public operators (Vivmark) are focusing on supply-constrained coastal markets at the same time. This is the "Blue over Red" thesis that I introduced in TMD 039. Notice too that this is happening while the labor market cools. Friday's July jobs report was a downside surprise with (-23K) jobs lost (though, private payrolls rose +30K net of government layoffs), which was more than 110K jobs below the +88K estimate. Capital in the Multifamily sector is moving based on the underlying fundamentals including basis (i.e. below replacement cost), limited supply (i.e. no new deliveries), and structural affordability (i.e. owning is 2-3x more than renting). That said, it's important to note that this transaction is not a vote of confidence for the market writ large, but rather for markets with solid fundamentals. Said differently, the "all clear" for markets like Austin or Phoenix has not yet arrived. JLL's commentary was that demand showed up on this transaction because these are best-in-class assets in supply-constrained markets. This is a market selection story, not a rising-tide story, and that's the point I want to emphasize. Summary BlackRock paying $1.63 billion for Camden's coastal California portfolio is a major data point demonstrating that institutional capital is coming back to multifamily, and it's coming back to supply-constrained markets first. Actionable Takeaway To me, this portfolio transaction is further confirmation that basis and supply constraint are what equity capital finds attractive today. Ironically, if you want growth, don't invest for growth. Rather, invest for strong fundamentals and growth will almost always be the byproduct. 5 NOI LeversNow, let's conclude by looking at a few asset level strategies. Unfortunately, the portfolio transaction mentioned above does not change the math for those of us holding assets through a flat year in which NOIs have been challenged, again. I've quoted this before and I'll quote it again, because it's the whole game in a soft market: buying a property is like a marriage, painful and costly to reverse, so avoiding the bad deals matters more than buying the good ones (TMD 049). Once you own it, the same discipline applies to operations. To grow NOI in these last five months of the year, here are five levers to focus on: 1. Controllable Expenses Insurance and property taxes are the two line items that moved the most against operators over the last three years, and in many cases, they're two of the only ones you can fight back against. Earlier this year, I ran an insurance RFP and I was surprised to see how favorable the rates and programs were in today's market. For operators that are truly a fiduciary to their capital, engaging in an insurance RFP process regularly (i.e. annually or biannually) is one of the five underwriting changes I laid out in TMD 063. Also, appealing assessed values can be impactful on both NOI and valuations, especially in markets where sale comps have fallen and the assessor hasn't caught up. A dollar saved on a controllable expense drops straight to NOI and gets capitalized at exit. 2. Other Income Utility recapture through a RUBS program, plus ancillary income like parking, storage, pet rent, and package lockers, is the least glamorous NOI on the financials but often the most durable. These income items don't depend on market rent growth, and they survive a soft leasing year. If you haven't audited your other-income line items against a well-run competitor or two in your submarket then it may be worthwhile to do so before the peak leasing season winds down. 3. Renewals > New Leases Retention protects the back door, and protecting the back door can be a lifeline in a flat rent growth market. Renewals are running near 57% of all leasing activity, up from about 51% a decade ago (TMD 076), and renewal rents were still positive at roughly +3.6%, on average, into early 2026 even as new-lease growth went flat. The risk is the renewal cliff I described in TMD 063: leases signed with heavy concessions in 2025 come up for renewal now, and if you push too hard on the burn-off, you trade a rent bump for a vacancy. Price renewals to keep the resident, and do everything in your power to keep them such as calling them personally to extend the renewal offer, hosting resident events, offering gift card incentives, free carpet cleanings, or even moving them into a comparable vacant unit for no additional cost. 4. Debt Discipline Despite a challenged equity and interest rates environment, the debt markets are quite liquid and healthy. My recommendation is to canvas the debt market before signing a lender LOI, because the first term sheet is almost never the best one, and lender requirements and spreads are all over the board. On the acquisition side, consider pursuing assumable, lower-coupon debt where it's accretive to do so, and be proactive with upcoming maturities. Extending and pretending into 2027 may work for some, but it may not work for others. The open question from TMD 076 still remains: Will lenders keep extending in 2H 2026, or will they finally begin to force the issue to get paid off or else? 5. Centralize and automate The quiet operational reset I wrote about in TMD 072 is a margin lever that compounds across a portfolio, and it's about improving workflows. Centralizing property administration, leasing support, and collections, then layering in AI or PropTech where it generates an ROI can enhance operating margins at the property level every month. Summary Organic rent growth is still largely hard to come by today, so NOI growth has to be manufactured from improving expenses, other income, resident retention, debt structure, and operational margin. None of these are dependent upon a market recovery, per se, which is exactly why they belong at the top of any asset management plan in 2H 2026. Actionable Takeaway Select a few of these levers at each asset this quarter to model the NOI impact in dollars and translate that to valuation at prevailing cap rates. Remember, the math says that $1 added to NOI is worth $20 in value in a 5% cap market. Weekly ListenThis week's listen is Counting Capital Episode 37 with Robert Brunswick, chairman of Buchanan Street Partners, and his guest John Burns, CEO of John Burns Research and Consulting, and one of the most respected housing researchers in the country. Burns fact-checks the parts of the housing story most of us repeat without checking: what the real shortage looks like versus the 4 to 5 million number that gets quoted everywhere, how much of the market Wall Street landlords actually own once you sit with the data, and why demographics (immigration, aging boomers, and shifting renter preferences) are the structural forces reshaping demand for single-family rentals and build-to-rent. You can listen to the full episode here. Wrap UpThat's it for today. I hope you found this edition of The Multifamily Download insightful. Consider sharing this link to The Multifamily Download with a friend or colleague. Your feedback is appreciated, so feel free to reply anytime. Thanks for reading. See you next week! Forwarded this email? Sign up here. Join me on LinkedIn | Twitter | Website |
The Multifamily Download · August 8, 2026
BlackRock's $1.6B Bet, 5 NOI Levers, & More
Get the next issue
Free every Saturday, read by thousands of multifamily professionals.
Subscribe Free →