Interest rates are moving up, and that inevitably means higher cap rates. Many investors have moved to the sidelines to wait out the uncertainty, but multifamily is well positioned to outperform the market. That is largely due to the billions of dollars of investment capital already allocated to multifamily that needs to be put to work, even if cap rates adjust.

“We still have hundreds of billions of dollars of undeployed capital still allocated to multifamily that wants to be allocated to multifamily,” David Brickman, the former CEO of Freddie Mac and the current CEO of NewPoint Real Estate Capital, tells GlobeSt.com. “There will be some offset in all of this by simply taking the view that they were unable to deploy all of the capital before, so even if there is some risk in buying at a cap rate that could move a little, it is still better to be deployed. So, I think that is one reason why we will continue to see multifamily faring well compared to other asset classes.”

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Kelsi Maree Borland

Kelsi Maree Borland is a freelance journalist and magazine writer based in Los Angeles, California. For more than 5 years, she has extensively reported on the commercial real estate industry, covering major deals across all commercial asset classes, investment strategy and capital markets trends, market commentary, economic trends and new technologies disrupting and revolutionizing the industry. Her work appears daily on GlobeSt.com and regularly in Real Estate Forum Magazine. As a magazine writer, she covers lifestyle and travel trends. Her work has appeared in Angeleno, Los Angeles Magazine, Travel and Leisure and more.

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