Q. How would you summarize the market in 2025?
Simply put, there is still a lot of money on the sidelines. For many properties, liquidity issues are a real concern. Following the pandemic-related cash infusion in 2020-2022, many people put their money in illiquid investments with longer lifespans, which have extended beyond expectations. Investors have declined to reinvest until they see returns from those previous investments. As many investors prioritize liquidity right now, they are seeking liquid investments with lower returns, making it more challenging to raise a fund.
Many investors are actively bidding on attractive properties, creating a highly competitive market. What’s more, with the democratization of information, proximity to property location is less critical than in the past. Investors can bid on properties nationwide, which intensifies competition. And with value-add deals relatively scarce, competition has caused pricing to move outside our comfort zone on many transactions.
Q. Have there been any shifts in recent months? What is the current landscape as we enter Q4?
People have been holding their breath, wondering what will happen – with tariffs, the economy, and the country’s overall well-being. Investors are holding onto cash right now, and liquid products like high-yield savings accounts and CDs are providing a decent return. Accordingly, there is less incentive to invest in illiquid opportunities, such as investment funds. When investors consider whether to invest in a fund, the risk-benefit analysis between investing and not investing has shifted for some investors to the negative.
Q. What changes do you foresee for 2026?
I don’t see any significant changes in 2026, although the mid-term elections could shift the landscape slightly. With the recent interest rate reduction, we are hopeful that economic stabilization will spark growth. Our markets aren’t highly vulnerable to issues like tariffs, and demand for multifamily housing and retail real estate is expected to remain strong. Accordingly, although the market will always be highly competitive, I expect our properties to perform well. Additionally, with our emphasis on patience, agility, and diversification, we are poised to capitalize on any market shifts.
Q. What advice do you have for investors right now?
Keep investing. No one knows what will happen, and the only way to benefit is to be in the game. You can minimize risks with diversification. No one can time the market exactly right, but by diversifying, you can create a balanced portfolio of opportunities. Finally, rely on experts’ experience and knowledge, and whether they have significant “skin in the game” as we do.
