An Ignoble Experiment: When is the Right Time to Invest in Real Estate?

2024/10/06

When is the Right Time to Invest in Real Estate?

Dear Investor,

The investment landscape over the last five years has not been for the faint of heart. During that time, we've seen a global pandemic causing massive supply chain disruption, extreme inflation, 11 interest rate increases in 17 months, and now historic multifamily new supply deliveries. Amidst the volatility, MLG's commitment to delivering strong returns and an exceptional experience has remained unchanged. As part of that commitment, MLG's team has put together a detailed summary of what they are seeing in the market across various real estate sectors and the broader capital markets. Follow this link to their 2024 Real Estate Market View to view the video and full presentation or check out a few highlights below.

By way of disclosure, we have an advertising relationship with this MLG Capital, meaning we get paid for making this introduction and sharing this content. As always with these types of deals, consider this an introduction and not a recommendation. Every deal is unique and the responsibility to vet any and every deal you invest in still lies with you. This opportunity is available to accredited investors only.

Here are the essential highlights from the 2024 market view:

Multifamily – After doing it's job as a hedge against the heavy inflation in 2021 and 2022, there has been some temporary softness in multifamily as supply deliveries have hit record highs, fueled by the artificially low interest rates and readily available capital seen in the early 2020s. Looking to the future, the combination of higher interest rates and rising construction costs have resulted in a dramatic drop in starts, while demand continues to grow. MLG expects to see operational tailwinds over the next few years.
Industrial – Industrial remains a resilient asset class with strong demand driven by e-commerce growth. While there's been some excess supply causing increased vacancy in the big box space, class B industrial product has seen virtually no new supply with the rising development costs. Consequently, buyers are often able to acquire class B product for a substantial discount to new replacement cost and benefit from outsized rent growth.
Capital Markets – With many institutional investors and syndicators out of the market, equity availability is significantly down. On the debt side, higher interest rates are constraining leverage, requiring more equity to close on deals. This combination is resulting in greatly diminished competition on the buy side.

At the link below, MLG Capital's CEO, Tim Wallen, takes you through an entire deck on their view of the market. We hope that the video information within can be of value to you as you navigate the private real estate climate.

If you have questions and want to connect with a member of the MLG team please visit https://mlgcapital.com/whitecoatinvestor/ or reach out directly to CJacques@mlgcapital.com.