Given the pricing I'm still seeing in recent deals I'm not sure people understand the implications that a permanent increase in the risk-free rate will have on real estate values.

Recently I spoke with an investor who is invested in a MF deal, the GP of that deal has decided to list the asset for sale despite the market volatility and high interest rate environment. The investor asked my opinion on the sale and asked me why any GP would consider selling a good asset today. The asset has no maturing debt, and the operations are doing fine. The deal sounds to be “in the money” and the investor is wondering if the GP needs to generate some profit/fees to keep their operations afloat during these challenging times. This is a reminder to all of us GPs that we need to be a good steward of our investor’s money, especially in times like today. We have been entrusted with our LPs hard-earned dollars and our job is to grow and protect their capital, instead of putting our interest ahead of them.

I’ve always been fascinated by the Korean Jeonse rental scheme. Retail shadow banking at its best. “In the jeonse scheme, tenants put up a deposit typically worth as much as 70% of the home's value, then live without paying rent for two years until the landlord returns the full amount.” I came across this article, interesting weekend read. koreatimes.co.kr/www/opinion…

Looking at a deal 35% off peak pricing, but even on aggressive underwriting the unlevered yield is below agency debt by 130 bps. There has been a clear disconnect over the last decade between value and operating cashflows.

Small, well laid out studios in highly desired neighborhood in Seattle. Undercutting in-place rents on traditional market units by 37%. Not everyone needs a swimming pool and a pickleball court in their apartment complex.

Contractors telling me that it will cost us $550K/unit to build multifamily product. Property nearby vintage 2019 selling for $350K / unit. I think I’m going shopping instead. 🛍️

This is my first post. I just came back from @ReConveneLA and I was amazed by the camaraderie that exist among this group of smart real estate professionals. I never understood what the REtwit community was all about but now I know. I’m excited to join in and contribute in any way possible to this community. Huge thanks to @moseskagan and @SimranKagan for putting an incredible event. The entire event was very thoughtful and refreshing. I look froward to getting to know more of you!