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IMG Attends GlobeSt. Multifamily Fall 2024

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GlobeSt National Conference Highlights Shifting Trends in Market Sentiment and Strategies

Woodland Hills, CA – October 18, 2024 –Industry professionals gathered this week at the annual GlobeSt. Multifamily event in Los Angeles to discuss the trends shaping the rental housing market, as investors and operators adjust to evolving economic conditions. Despite ongoing volatility in capital markets, a sense of urgency to deploy capital is growing, with participants increasingly accepting the “new normal” of the real estate landscape. However, concerns over unwarranted optimism were raised as some feared market instability might still pose risks.

Key Takeaways

  • A significant focus was on owners with high-leverage deals and upcoming loan maturities. Many of these owners have benefited from lenders extending their loans, allowing additional time for interest rates to drop and property values to recover. However, despite these temporary measures, significant relief has yet to materialize in the capital markets, and there is growing concern that these operators may run out of time.
  • Operational challenges such as rising cases of fraud and non-payers continue to strain real estate businesses.
  • Use of artificial intelligence in property and financial tech applications is quickly gaining momentum. However, many attendees expressed uncertainty about how new AI tools will impact their operations and decision-making processes.
  • The demand for multifamily properties in prime locations, particularly those built after 2000, remains strong, with these deals attracting significant attention. On the other hand, older buildings with value-add components in some secondary and tertiary markets are becoming harder to justify in today’s financial climate.
  • A point of optimism was the absorption of new supply in popular markets. As this trend continues, experts expect occupancy rates to rise, which could positively affect rental prices. However, with rents and occupancy levels still dipping and expenses remaining high, many in the industry are exploring alternative income streams to drive NOI growth to service debt and distribute cash flow to investors.

Navigating the New Real Estate Landscape

According to panelist Hessam Nadji, president and CEO of Marcus & Millichap, multifamily investment challenges abound, from geopolitics to climate change.

“There’s always something to worry about, and it’s easy to overreact. Yet, if we take a step back and consider the big picture, the past decade reveals significant growth: The U.S. population has increased by 16.2 million people.We’ve added 8.4 million new households. Nearly 20 million jobs have been created, along with 2.7 million job openings as of 2024. Core retail sales have risen by 38.7%.”

The GlobeSt. Multifamily Fall 2024 conference, held at the JW Marriott Los Angeles L.A. Live, underscored the industry’s adaptation to current challenges while pointing to opportunities ahead for investors and operators willing to evolve with the changing market.

About GlobeSt. Multifamily

For over three decades, GlobeSt. Multifamily has been the most influential networking platform in the U.S. multifamily real estate market, bringing together key industry stakeholders to network and exchange ideas in the current, as well as future, challenges and opportunities.

The 2024 program focused on the needs of owners, operators, developers, and investors, providing a new format featuring a combination of the most active and most innovative firms and executives.

About Investors Management Group

Founded by Neil Schimmel, IMG is a nationally acclaimed real estate investment and asset management firm highly specialized in apartment communities. Our mission is to create vibrant, sustainable living environments through strategic investments and a commitment to community development. With a network of over 1,000 accredited investors, we strive to enhance the quality of life for our 5,000+ tenants nationwide and support the growth of local neighborhoods. IMG’s culture is characterized by innovation and a steadfast commitment to creating value in multifamily investments. Earlier this year, the firm received its second “Commercial Real Estate Visionary” Award from the Los Angeles Times. Learn more

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