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👋 Happy Sunday, Best Ever readers!
In today’s newsletter, sellers get motivated, landlords get probed, cold storage has a problem, multifamily and MOB starts tick up, and much more.
Today's edition is presented by Real Estate Alpha, Pitch Slam 2026 winner. Most real estate funds lock your capital up for 3-7 years or more. Real Estate Alpha gives it back within 90 days after year one. Fixed 12% annually, 15-19% effective yield due to tax benefits, and fully backed by 700+ operating units across Western Ohio. See why investors are allocating to this structure. Learn more today.
🔓 Most sponsors are raising capital with one hand tied behind their backs. Join us Thursday, April 2, at 1 pm ET for a free webinar with Equity Trust that shows you how to unlock retirement account capital — without slowing down your raise. Register here.
Let’s CRE!
🏛️ Corporate Probe: Senator Elizabeth Warren has sent letters to 13 of the nation's largest landlords — including Greystar, Blackstone, and Invitation Homes — demanding portfolio data, rent records, and maintenance histories by April 8, as Congress advances its biggest bipartisan housing supply bill in 30 years.
₿ Crypto Mortgages: Fannie Mae has agreed to accept crypto-backed mortgages for the first time through a new product from Better Home & Finance and Coinbase, allowing buyers to pledge bitcoin or stablecoins as collateral instead of making a cash down payment.
❄️ Cold Storage War: Cold storage vacancy has climbed to a 20-year high of nearly 7% after more than 10M SF of new supply delivered in 2025 outpaced net absorption of just 3.5M SF, with rents having roughly doubled since 2019 to $28 PSF.
🏦 Bank Boost: Proposed capital rule changes from the Fed, FDIC, and OCC could unlock a portion of $175 billion in excess bank capital for CRE lending, with lower risk weights on stabilized, low-leverage assets potentially closing the pricing gap with non-bank lenders.
🏗️ Permit Patchwork: Multifamily permitting ticked up 5.4% YoY to 453,400 units in January 2026, according to RealPage, but gains were uneven — half of major markets posted increases while the other half came in flat or negative, with Columbus, Los Angeles, and Miami leading all cities.
Multifamily dealmaking is making a comeback, and it's not because market conditions improved dramatically. It's because sellers are tired of waiting.
Apartment sales volume climbed 9% in 2025 to $165.5 billion, rising across every subtype and metro tier. Cap rates have held at 5.7% for eight consecutive quarters — the longest unchanged stretch in 25 years — while price declines moderated from 3% in 2024 to 1.3% in 2025. The bid-ask gap hasn't closed so much as it's become irrelevant for a growing class of sellers who no longer have the luxury of waiting.
As loan maturities piled up and extension options dried out, owners who had been holding for a better day ran out of runway. Forced sellers, it turns out, are more motivated than patient ones. Rather than pursuing traditional common equity deals, investors are increasingly targeting recapitalizations and structured equity plays like preferred equity, rescue capital, and hybrid structures that step ahead of existing equity while helping sponsors close refinancing gaps.
The Capital Stack Shift: For buyers with flexibility across the capital stack, that's a sourcing advantage. Recapitalizations and structured equity investments are surfacing off-market, tied directly to capital structure dislocation rather than property-level distress — a dynamic that rewards firms that can move across credit and equity simultaneously.
Sentiment Is Running Ahead of Pricing: Positive outlooks toward core multifamily acquisitions climbed to 76% of industry professionals in Q4 2025, up sharply from a year earlier. Multifamily investment volume is projected to rise another 9% in 2026 — with fundamentals, not rate cuts, doing the heavy lifting.
Markets Under the Microscope: Not all assets are attracting equal interest. Areas with durable demand drivers and thin supply pipelines are drawing the most capital, while Sun Belt markets still absorbing elevated deliveries face tighter scrutiny. Buyers are stress-testing rent assumptions, widening exit cap rates, and structuring for downside protection rather than recovery upside.
Fundamentals are cooperating. Vacancy fell 130 bps from its early 2024 peak to 4.6% by Q3 2025, while new construction starts dropped to their lowest volume in more than a decade. The supply wave is still working through the system, but the pipeline behind it is thin, and rent growth projections of 2.25–2.5% over the next 12–18 months reflect a market that's quietly rebalancing.
Refinancing pressure is forcing sellers' hands. Buyers who can move across the capital stack and underwrite to current conditions — rather than optimism — are finding the best opportunities right now.
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MOBs have quietly become one of the steadier performers in CRE, and a recent uptick in construction starts is raising the question of whether the supply constraint that's been driving record occupancy is about to ease.
The short answer: not yet. Occupancy hit a record 92.7% nationally, driven by a structural shift in how healthcare is delivered — hospital systems are moving care into lower-cost outpatient facilities and expanding aggressively to do it.
Supply constraints are amplifying the effect. New MOB starts bottomed out at just 1% of inventory in Q4 2024, leaving absorption consistently ahead of deliveries. That imbalance is giving landlords real pricing leverage. Average MOB rent growth has outpaced both office and Class A averages every year since 2022, with new construction rents running at nearly twice in-place rents.
A few dynamics are reshaping who's signing leases and how:
Health systems accounted for 46% of medical leasing in 2025, concentrated in large multispecialty clinics ranging from 40,000 to 60,000 SF.
Specialty providers represented 36% of activity, with psychiatry and behavioral health making up 28% of that share.
Lease structures are trending toward more aggressive escalations as landlords capitalize on the gap between in-place and market rents.
Institutional capital is taking notice. Transaction volume accelerated sharply in Q4 2025, and institutional buyers captured their largest share of MOB purchases of any year this decade. With limited supply and demographic tailwinds that aren't going away, the mark-to-market opportunity at renewal is substantial.
Most sponsors know retirement accounts exist as a capital source. Few know how to actually accept them without slowing down their raise — or adding complexity to their operations.
Thursday, April 2 at 1 pm ET, Equity Trust Directors Kelsey Dineen and Matt Calhoun are breaking it all down in a free, practical webinar built specifically for sponsors.
You'll walk away knowing:
Which retirement accounts (IRAs, Roth, SEP, HSAs) can invest in your deals
What you need to accept IRA capital in syndications and funds
How to expand your investor pool without adding work to your team
Can’t make it to the live event? Register anyway, and we’ll send you the replay.
REGISTER NOW
Self-storage made a lot of people a lot of money — until it didn't. Kris Bennett, COO of QC Capital, watched that cycle play out in real time, riding storage from 2017 through roughly $130 million in transactions before watching occupancy flatten, rents stall, and valuations compress. He didn't wait for the bottom. He pivoted to small bay industrial. And he thinks it looks a lot like storage did in 2016.
This week, Bennett joined Ash Patel and Amanda Cruise on the Best Ever CRE Show to break down why small bay — flex space catering to HVAC companies, auto detailers, landscape operations, and light fabricators — is drawing serious investor attention without yet drawing serious competition.
The Supply Argument: Unlike storage, small bay inventory is genuinely thin. Bennett's test: try to name three small bay facilities within 10 minutes of where you're sitting. Most people can't. Infill locations in dense, high-barrier submarkets (Bennett targets growing suburbs of major metros like Charlotte and Atlanta) face near-zero new supply pressure, and zoning constraints make that unlikely to change.
The Buy Box: Minimum 25,000 SF, 10-plus units, quality construction, and infill location. Individual unit size targets roughly 1,200 to 5,000 SF — large enough to attract tenants on year-long leases, small enough to stay below the radar of regional and national tenants who bring CAM headaches. Triple-net leases on stabilized assets position well for exit and attract out-of-state buyers.
The Financing Edge: Stabilized small bay qualifies for life insurance company debt — a detail most investors in this space miss entirely. Bennett locked in a 30-year amortization at a fixed rate on a recent Mooresville, NC acquisition, a structure local banks rarely offer. The trade-off is a step-down prepayment penalty, making it a fit for operators with a clear five-year hold thesis and no plans to exit early.
The operational profile is part of the appeal. Sign leases, maintain landscaping, keep the property clean. Bennett's version of asset management is largely getting out of tenants' way — a contrast to the hands-on requirements of multifamily or the retail-style churn of storage.
🎙️ Listen to Kris’s full episode here.
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— Joe Fairless
