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221128_Multifamily-market_Blog
Erik Hayden Nov 29, 2022 9:38:22 AM 6 min read

Multifamily market is stronger than ever – and that’s great news for our investors!

The CBRE Q4 2022 Bay Area Multifamily Report is out and once again there’s good news for investors in downtown San Jose. Year-over-year rents were up 10.5% as demand for living space remained strong. 

“Absorption” – a fancy way to describe an apartment unit that’s taken off the market by a renter, stood at 97% of new supply year-to-date (about as good as you can get because there’s always turnover). That’s a good number. San Jose had the second-highest absorption to deliveries ratio of any city in the country. Another way of putting this is that vacancies are low because people want to live here.

While rents are up and demand is strong, supply has remained relatively constrained. When it comes to new construction, the CBRE report found that Central San Jose ranked #14 nationally. From an investor’s point of view, that’s a good number, too, because it reduces the chance for overbuilding.

We’ve talked about the demand side for multifamily in other blogs. Millennials have named San Jose their #1 destination city, according to one report. U.S. News ranks San Jose #5 in its annual “Best Places to Live” survey. The unemployment rate in the San Jose-Sunnyvale-Santa Clara MSA stood at 2.2% in September, well below the national average. 

We’ve seen the need for quality multifamily housing in San Jose and are working hard to address it. Our Echo is a 389-unit residential building in the heart of downtown. It’s a part of our Fund II, currently open to investors. TMBR, a part of our Fund I, is bringing another 250+ residential units to San Jose. It, too, is downtown adjacent to Google’s future mega-campus and Diridon Station, the largest transit hub on the West Coast. 

There are a lot of good things happening for multifamily housing in downtown San Jose as the latest CBRE market report confirms. To find out how you can be a part of it, contact us today.

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The contents of this communication: (i) do not constitute an offer of securities or a solicitation of an offer to buy securities, (ii) offers can be made only by the confidential Private Placement Memorandum (the “PPM”) which is available upon request, (iii) do not and cannot replace the PPM and is qualified in its entirety by the PPM, and (iv) may not be relied upon in making an investment decision related to any investment offering by an issuer, or any affiliate, or partner thereof ("Issuer").

All potential investors must read the PPM and no person may invest without acknowledging receipt and complete review of the PPM.

With respect to any performance levels outlined herein, these do not constitute a promise of performance, nor is there any assurance that the investment objectives of any program will be attained. All investments carry the risk of loss of some or all of the principal invested. Assumptions are more fully outlined in the Offering Documents/ PPM for the respective offering. Consult the PPM for investment conditions, risk factors, minimum requirements, fees and expenses and other pertinent information with respect to any investment.

These investment opportunities have not been registered under the Securities Act of 1933 and are being offered pursuant to an exemption therefrom and from applicable state securities laws. All offerings are intended only for accredited investors unless otherwise specified.

Past performance are no guarantee of future results. All information is subject to change. You should always consult a tax professional prior to investing. Investment offerings and investment decisions may only be made on the basis of a confidential private placement memorandum issued by Issuer, or one of its partner/issuers. Issuer does not warrant the accuracy or completeness of the information contained herein. Thank you for your cooperation.



Real Estate Risk Disclosure:

- There is no guarantee that any strategy will be successful or achieve investment objectives including, among other things, profits, distributions, tax benefits, exit strategy, etc.;
- Potential for property value loss – All real estate investments have the potential to lose value during the life of the investments;
- Change of tax status – The income stream and depreciation schedule for any investment property may affect the property owner’s income bracket and/or tax status. An unfavorable tax ruling may cancel deferral of capital gains and result in immediate tax liabilities;
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- Illiquidity – These assets are commonly offered through private placement offerings and are illiquid securities. There is no secondary market for these investments.
- Reduction or Elimination of Monthly Cash Flow Distributions – Like any investment in real estate, if a property unexpectedly loses tenants or sustains substantial damage, there is potential for suspension of cash flow distributions;
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Opportunity Zone Disclosures

- Investing in opportunity zones is speculative. Opportunity zones are newly formed entities with no operating history. There is no assurance of investment return, property appreciation, or profits. The ability to resell the fund’s underlying investment properties or businesses is not guaranteed. Investing in opportunity zone funds may involve a higher level of risk than investing in other established real estate offerings.
- Long-term investment. Opportunity zone funds have illiquid underlying investments that may not be easy to sell and the return of capital and realization of gains, if any, from an investment will generally occur only upon the partial or complete disposition or refinancing of such investments.
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