NYC Tops Apartment Pipeline for 4th Year Running

Together with

Good morning. More than 500,000 new apartments are hitting the market this year, with the South leading the charge and New York refusing to give up the top spot.

Today’s issue is brought to you by Agora—helping you decide the right strategy for your next capital raise.

Market Snapshot

BALANCING ACT

TOGETHER WITH AGORA

Exclusive webinar - Real estate investing: Fund vs. deal-by-deal

Real estate operators today face a critical decision when raising capital: stick with deal-by-deal syndications or transition to a fund model?

Join us for an exclusive webinar, Real estate investing: Fund vs. deal-by-deal, where industry veteran Don Tepman (aka the StripMallGuy) shares how he successfully made the switch—and what he wishes he knew before doing it. Alongside fund formation attorney Yoni Tuchman of DLA Piper, you’ll get a behind-the-scenes look at the pros, cons, and key differences between these two strategies.

In this expert-led session, you’ll learn how to:

• Compare structure, operations, and long-term strategy

• Decide if a fund model is right for your business

• Build and launch your fund—from deck to PPM

• Raise capital and communicate effectively with LPs

• Track fund performance and navigate legal nuances

Whether you're just getting started or planning your next capital raise, this webinar will help you make the right move with confidence.              

*This is a paid advertisement. Please see the full disclosure at the bottom of the newsletter.

• Tax boost: The "Big Beautiful Bill" makes U.S. R&D investments fully deductible again and opens the door to amending earlier returns for tax savings. (sponsored)

• Breaking ground: Nashville developer Giarratana has closed a $340M construction loan with Benefit Street Partners for Paramount, a $460M, 60-story mixed-use tower set to rise in downtown. Construction starts Sept. 15, 2025, with completion slated for May 2028.

• Rising cities: From Austin to Goodyear, a new generation of U.S. cities is leading the charge in economic growth, fueled by infrastructure upgrades, booming business activity, and strategic investment in talent and innovation.

• Broker boom: Mid-2025 saw a surge in large brokered commercial real estate deals, with CBRE and JLL dominating a market that increasingly favors advised transactions over unbrokered ones.

• Modular moment: Modular construction now makes up nearly 9% of U.S. multifamily starts, with developers like Resia and Greystar leading the charge — and a new federal bill could clear the way for broader adoption.

• Pushing back: Federal Reserve Governor Lisa Cook is pushing back against calls to resign following mortgage fraud allegations by FHFA Director Bill Pulte—escalating political tensions just as the Fed eyes a potential rate cut.

• Tariff tensions: Construction spending dipped in mid-2025 as tariffs on metals like steel and copper reshaped supply chains and pricing, while categories like lumber and drywall remained stable — for now.

• AI venture: EliseAI secured $250M in fresh funding led by Andreessen Horowitz, doubling its valuation and reinforcing its push to transform multifamily operations through agentic AI.

• Outperforming: Manufactured housing is proving to be one of CRE’s strongest performers in 2025, driven by affordability, low vacancies, and investor-friendly fundamentals — all while keeping delinquencies under 1.4%.

• Shifting starts: Multifamily construction surged in July with starts hitting their highest level since 2023, even as permits and completions slowed — signaling near-term momentum but longer-term caution in the pipeline.

• Portfolio play: Foulger Pratt acquired a 1,248-unit apartment portfolio from AvalonBay for $447M, betting on D.C.’s rent growth and long-term upside as new supply slows and high-quality assets trade below replacement cost.

• Austin reset: Amid record-high vacancies and falling rents, investors are eyeing Austin’s oversupplied apartment market as a rare buying opportunity, betting on a rebound as construction slows and demand holds steady.

• Cold storage: Dedeaux Properties sold a fully leased 64K SF cold storage facility in San Jose for $18M, capitalizing on investor demand in one of the tightest cold storage markets in the U.S.

• Scaling up: Meta has launched its $1B hyperscale data center in Kansas City, part of a 5.5M SF tech campus, highlighting the region’s rise as a key emerging data center hub backed by clean energy and strong infrastructure.

• Logistics shift: Holder Properties secured $44M in financing for Dogwood Logistics Center near Atlanta, adding nearly 390K SF of industrial space to a market that continues to show strength in development and investment.

• Fire sale: The retail condo at the former New York Times building sold for just $28M — a staggering 94% discount from Kushner’s 2016 purchase — as Times Square’s shifting retail landscape opens doors for bold repositioning plays.

• Intern pipeline: Target named former intern Michael Fiddelke as its next CEO amid falling sales and stock performance, betting on internal experience to steer the retailer out of a multi-year slump.

• Mall makeover: Second Horizon Capital acquired the 950K SF Orange Park Mall near Jacksonville — its first Florida deal — with plans to revitalize the nearly full retail center through upgrades, local partnerships, and expanded programming.

• Pushing the pro: Lowe’s is acquiring Foundation Building Materials for $8.8B in a major play to expand its contractor business, intensifying its battle with Home Depot for dominance in the fragmented and fast-growing pro market.

• Earnings corner: Walmart raised its full-year sales and earnings outlook amid strong e-commerce and resilient consumer demand, even as rising tariff costs began pressuring profits and forcing selective price hikes.

• Diplomatic expansion: The Consulate General of India signed a 21K SF lease at LA’s Aon Center, establishing the city's first Indian consulate to better serve Southern California’s large Indian-American community.

• Tower trouble: The ground lease for 1140 Sixth Avenue in Midtown Manhattan has lost 90% of its value since 2016 due to high vacancies, rising debt costs, and a failed renovation gamble, leading to foreclosure proceedings.

• Flagler refi: Steve Ross secured a $340M refinancing for the nearly fully leased One Flagler tower in West Palm Beach, marking the first completed project by his new firm Related Ross and furthering his high-profile bet on the city's commercial growth.

📈 CHART OF THE DAY