July 2, 2025 • 8 mins
In this episode, Sandy MacKay introduces David Valger, who provides insights into current multifamily market conditions. They explore the supply-demand dynamics and economic factors impacting real estate, followed by a discussion on advancements in technology within the industry. The episode features sponsorship segments on Institutional Property Advisors' Arbello project financing and Choice Renovations Canada's new partnership. Sandy highlights Marcus & Millichap's commercial real estate milestones and delves into trends in rent growth, tenant retention, and affordability in Canada. The episode also examines strategies employed by institutional landlords to increase rental supply, concluding with Sandy's closing remarks.
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(00:00):
What are the hidden opportunities in themultifamily real estate sector that could
(00:03):
potentially transform your investment landscapedespite tariff uncertainties and macroeconomic
challenges?
Welcome to the Multifamily Real Estate InsightsPodcast.
I'm your host, Sandy MacKay.
Let's get right to it.
In a recent episode of Navatar's A-GamePodcast, David Valger, President of DVO Real
(00:26):
Estate, shared his insights on why the currentmarket conditions may present one of the most
attractive times to invest in multifamily realestate.
Hosted by Alok Misra, CEO of Navatar, theepisode delves into the impact of macroeconomic
trends, political risks, and emergingtechnologies such as artificial intelligence on
real estate deal-making and portfoliomanagement.
(00:49):
Valger highlights that we're in a historicallylow spot of valuation, with cap rates up and
net operating income down, and capital onpause.
He suggests that if you can make a deal worktoday without relying on cap rate compression
or rent growth, you preserve the optionality tooutperform when the cycle turns.
This perspective is particularly relevant fordisciplined investors looking to acquire
(01:13):
high-quality assets at a discount.
One key theme Valger discusses is thesupply-demand imbalance in the multifamily
sector.
With a temporary glut of new supply inhigh-growth markets, development starts have
plummeted due to interest rate hikes andmaterial costs.
This scenario is setting the stage forsignificant rent growth as the U.S.
(01:34):
may face a multifamily unit shortfall of800,000 to 1 million units over the next three
to five years.
Valger notes that as single-family homes becomemore unaffordable, demand for multifamily units
is rising, and if supply stalls, rents willclimb significantly.
Valger also addresses the impact of tariffs andtrade policies on development economics.
(01:59):
He suggests that while tariffs may raiseconstruction costs, they could also benefit
firms with strong operations and sourcingcapabilities.
This could create an advantage for disciplinedinvestors who are well-positioned on cost
controls and sourcing, as tariffs raise the barfor less experienced operators.
Furthermore, Valger emphasizes the role oftechnology and artificial intelligence as the
(02:22):
next competitive edge in real estate.
DVO Real Estate is experimenting withartificial intelligence to improve investor
communication and identify distressedopportunities faster.
Valger believes that artificial intelligencecan help identify at-risk assets, find signals
in data, and make investor interactions moreimpactful.
(02:45):
Throughout the episode, Alok Misra and Valgerdiscuss how technology, like Navatar's
platform, empowers firms to manage deal flow,fundraising, and investor relationships with
greater speed and insight.
This is especially critical in times of marketdislocation, where having the right tools can
make a significant difference.
(03:07):
In an exciting development in the multifamilysector, Institutional Property Advisors, a
division of Marcus & Millichap, hassuccessfully secured $61 million in financing
for the construction of a new mixed-useproperty called Arbello in San Mateo,
California.
The financing was arranged by Brandon Roth,managing director in IPA Capital Markets’ Palo
(03:31):
Alto office, on behalf of The Martin Group andJPF Capital.
Arbello will be a five-story property offering120 residential units for rent along with
approximately 29,000 square feet of officespace.
The development will include modern amenitiessuch as a co-working space, wellness center,
clubhouse, expansive courtyard, and a rooftopdeck, making it an attractive option for
(03:56):
potential tenants.
Brandon Roth highlighted the achievement,noting that few developers in the Bay Area have
managed to secure financing and initiateconstruction in today's challenging market
environment.
He attributes this success to the quality ofThe Martin Group's product and the strategic
location of the project.
The team was able to create a competitivemarket, receiving construction financing quotes
(04:19):
from six different lenders.
Marcus & Millichap, the parent company ofInstitutional Property Advisors, is a
well-established national brokerage firmspecializing in commercial real estate
investment sales, financing, research, andadvisory services.
In 2023 alone, the company closed 7,546transactions with a sales volume of
(04:44):
approximately $43.6 billion.
This track record underscores their expertiseand influence in the real estate sector.
While this news is coming out of California,it's a great reminder of the innovative
projects and opportunities that exist acrossNorth America in the multifamily sector.
As we look at similar opportunities closer tohome, particularly in Ontario cities like
(05:09):
Hamilton, Niagara, and Burlington, it's clearthat with the right strategy and partnerships,
significant success can be achieved even inchallenging market conditions.
In a significant move to address the challengesof aging rental properties in Toronto, Choice
Renovations Canada has announced a strategicpartnership with a major Toronto-based
developer.
(05:30):
This collaboration aims to overhaul agingpurpose-built rental housing across the Greater
Toronto Area, focusing on faster renovationsand improved tenant retention.
The partnership is poised to support the rentalsector at a time when affordability challenges
and rising demand have intensified the need formodernizing older rental properties.
Josh Wilson, Chief Executive Officer of ChoiceRenovations Canada, expressed optimism about
(05:54):
the venture, stating, "We're entering a new erain multifamily real estate.
Institutional players want more than justconstruction; they want strategic execution,
predictable returns, and elevated tenantexperiences.
That's exactly what we deliver."
The collaboration aims to streamlinelarge-scale unit upgrades, emphasizing the
(06:15):
importance of speeding up unit turnovers andboosting return on investment per suite without
compromising quality or timelines.
Choice Renovations Canada specializes inmultifamily rental renovations, including unit
overhauls and common area improvements, servingclients such as real estate investment trusts,
hedge funds, and publicly listed real estatefirms across North America.
(06:40):
This announcement comes at a time when rentgrowth across Canada is softening.
According to Rentals.ca and Urbanation, theaverage asking rent in May was two thousand one
hundred twenty-nine dollars, showing only a0.1% increase from April and a 3.3% decrease
compared to the same month in 2023.
(07:02):
Purpose-built rental units averaged twothousand one hundred seventeen dollars in May,
marking a 2% year-over-year decrease.
Meanwhile, rents for condominium apartmentsdeclined more sharply, dropping 3.6%
year-over-year to an average of two thousandone hundred ninety-two dollars.
As affordability pressures persist,institutional landlords are leveraging
(07:23):
incentives and land-use strategies to expandthe rental supply.
An example of this is Canadian ApartmentProperties Real Estate Investment Trust's
recent announcement to build one hundredseventy new rental homes in Mississauga and
convert underused non-residential space intofifty more units across its portfolio.
This initiative by Choice Renovations Canadaand its Toronto-based partner highlights the
(07:46):
potential for strategic renovations to enhancethe rental market's resilience and capacity.
By modernizing aging properties, they aim tonot only meet the demand for quality rental
housing but also contribute to stabilizing rentprices amidst a challenging economic climate.
Thank you for listening to the Multifamily RealEstate Insights Podcast.
(08:08):
I'm your host, Sandy MacKay.
See you on the next one.
What are the hidden opportunities in themultifamily real estate sector that could
(00:03):
potentially transform your investment landscapedespite tariff uncertainties and macroeconomic
challenges?
Welcome to the Multifamily Real Estate InsightsPodcast.
I'm your host, Sandy MacKay.
Let's get right to it.
In a recent episode of Navatar's A-GamePodcast, David Valger, President of DVO Real
(00:26):
Estate, shared his insights on why the currentmarket conditions may present one of the most
attractive times to invest in multifamily realestate.
Hosted by Alok Misra, CEO of Navatar, theepisode delves into the impact of macroeconomic
trends, political risks, and emergingtechnologies such as artificial intelligence on
real estate deal-making and portfoliomanagement.
(00:49):
Valger highlights that we're in a historicallylow spot of valuation, with cap rates up and
net operating income down, and capital onpause.
He suggests that if you can make a deal worktoday without relying on cap rate compression
or rent growth, you preserve the optionality tooutperform when the cycle turns.
This perspective is particularly relevant fordisciplined investors looking to acquire
(01:13):
high-quality assets at a discount.
One key theme Valger discusses is thesupply-demand imbalance in the multifamily
sector.
With a temporary glut of new supply inhigh-growth markets, development starts have
plummeted due to interest rate hikes andmaterial costs.
This scenario is setting the stage forsignificant rent growth as the U.S.
(01:34):
may face a multifamily unit shortfall of800,000 to 1 million units over the next three
to five years.
Valger notes that as single-family homes becomemore unaffordable, demand for multifamily units
is rising, and if supply stalls, rents willclimb significantly.
Valger also addresses the impact of tariffs andtrade policies on development economics.
(01:59):
He suggests that while tariffs may raiseconstruction costs, they could also benefit
firms with strong operations and sourcingcapabilities.
This could create an advantage for disciplinedinvestors who are well-positioned on cost
controls and sourcing, as tariffs raise the barfor less experienced operators.
Furthermore, Valger emphasizes the role oftechnology and artificial intelligence as the
(02:22):
next competitive edge in real estate.
DVO Real Estate is experimenting withartificial intelligence to improve investor
communication and identify distressedopportunities faster.
Valger believes that artificial intelligencecan help identify at-risk assets, find signals
in data, and make investor interactions moreimpactful.
(02:45):
Throughout the episode, Alok Misra and Valgerdiscuss how technology, like Navatar's
platform, empowers firms to manage deal flow,fundraising, and investor relationships with
greater speed and insight.
This is especially critical in times of marketdislocation, where having the right tools can
make a significant difference.
(03:07):
In an exciting development in the multifamilysector, Institutional Property Advisors, a
division of Marcus & Millichap, hassuccessfully secured $61 million in financing
for the construction of a new mixed-useproperty called Arbello in San Mateo,
California.
The financing was arranged by Brandon Roth,managing director in IPA Capital Markets’ Palo
(03:31):
Alto office, on behalf of The Martin Group andJPF Capital.
Arbello will be a five-story property offering120 residential units for rent along with
approximately 29,000 square feet of officespace.
The development will include modern amenitiessuch as a co-working space, wellness center,
clubhouse, expansive courtyard, and a rooftopdeck, making it an attractive option for
(03:56):
potential tenants.
Brandon Roth highlighted the achievement,noting that few developers in the Bay Area have
managed to secure financing and initiateconstruction in today's challenging market
environment.
He attributes this success to the quality ofThe Martin Group's product and the strategic
location of the project.
The team was able to create a competitivemarket, receiving construction financing quotes
(04:19):
from six different lenders.
Marcus & Millichap, the parent company ofInstitutional Property Advisors, is a
well-established national brokerage firmspecializing in commercial real estate
investment sales, financing, research, andadvisory services.
In 2023 alone, the company closed 7,546transactions with a sales volume of
(04:44):
approximately $43.6 billion.
This track record underscores their expertiseand influence in the real estate sector.
While this news is coming out of California,it's a great reminder of the innovative
projects and opportunities that exist acrossNorth America in the multifamily sector.
As we look at similar opportunities closer tohome, particularly in Ontario cities like
(05:09):
Hamilton, Niagara, and Burlington, it's clearthat with the right strategy and partnerships,
significant success can be achieved even inchallenging market conditions.
In a significant move to address the challengesof aging rental properties in Toronto, Choice
Renovations Canada has announced a strategicpartnership with a major Toronto-based
developer.
(05:30):
This collaboration aims to overhaul agingpurpose-built rental housing across the Greater
Toronto Area, focusing on faster renovationsand improved tenant retention.
The partnership is poised to support the rentalsector at a time when affordability challenges
and rising demand have intensified the need formodernizing older rental properties.
Josh Wilson, Chief Executive Officer of ChoiceRenovations Canada, expressed optimism about
(05:54):
the venture, stating, "We're entering a new erain multifamily real estate.
Institutional players want more than justconstruction; they want strategic execution,
predictable returns, and elevated tenantexperiences.
That's exactly what we deliver."
The collaboration aims to streamlinelarge-scale unit upgrades, emphasizing the
(06:15):
importance of speeding up unit turnovers andboosting return on investment per suite without
compromising quality or timelines.
Choice Renovations Canada specializes inmultifamily rental renovations, including unit
overhauls and common area improvements, servingclients such as real estate investment trusts,
hedge funds, and publicly listed real estatefirms across North America.
(06:40):
This announcement comes at a time when rentgrowth across Canada is softening.
According to Rentals.ca and Urbanation, theaverage asking rent in May was two thousand one
hundred twenty-nine dollars, showing only a0.1% increase from April and a 3.3% decrease
compared to the same month in 2023.
(07:02):
Purpose-built rental units averaged twothousand one hundred seventeen dollars in May,
marking a 2% year-over-year decrease.
Meanwhile, rents for condominium apartmentsdeclined more sharply, dropping 3.6%
year-over-year to an average of two thousandone hundred ninety-two dollars.
As affordability pressures persist,institutional landlords are leveraging
(07:23):
incentives and land-use strategies to expandthe rental supply.
An example of this is Canadian ApartmentProperties Real Estate Investment Trust's
recent announcement to build one hundredseventy new rental homes in Mississauga and
convert underused non-residential space intofifty more units across its portfolio.
This initiative by Choice Renovations Canadaand its Toronto-based partner highlights the
(07:46):
potential for strategic renovations to enhancethe rental market's resilience and capacity.
By modernizing aging properties, they aim tonot only meet the demand for quality rental
housing but also contribute to stabilizing rentprices amidst a challenging economic climate.
Thank you for listening to the Multifamily RealEstate Insights Podcast.
(08:08):
I'm your host, Sandy MacKay.
See you on the next one.
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