The head of the country's largest apartment REIT fund has finally given them two cents, how tariffs, trade wars and economic uproars affect business.
The prospect of the income season should be for this course. But the industry has been basically a mom since Liberation Day, and he talked directly about revenue calls from Equity Residential, the Avalonbay community and the Camden Property Trust.
"You're like the only apartment real estate investment trust that has really talked about residents' concerns so far," Piper Sandler analyst Alexander Goldfarb said on a Thursday conference call in Avalonbay.
Executives admit that uncertainty is clouded with the crystal ball. Nevertheless, they share what they can sacred.
The result: The market fundamentals are solid and ready to strengthen; the biggest unknown is the job market.
All three REITs say demand vs. the strength it gets - at least for now.
Mortgage rates and high housing prices have prevented potential buyers from leaving the lease and further put pressure on the housing market across the country. Meanwhile, the peak rental season is in life, creating the perfect storm for the owners.
The problem is that chat is endless.
Sean Breslin, CEO of Avalonbay, said the tenant’s conversation, that is, potential and current, was called: “I have a job today; do I have a job tomorrow?”
Arlington, Virginia-based REIT has multiple families in 12 states, especially Washington, D.C., where federal layoffs damage the job market and shocked the lasting fear among those still employed.
On September 30 alone, the District of Columbia’s federal workforce is expected to shrink by 21%, according to the District’s Office of Income Analysis, which now predicts that the Metro area will enter a moderate recession by the end of the year.
According to a May analysis by Reuters, since Donald Trump took office, he has swapped local shots for one country and 260,000 federal employees since his election, force or some combination.
Avalonbay would feel this absence. Breslin said about 12% of residents work in the federal government.
Neither the REIT nor peer equity nor Camden said layoffs hit the lease figures. But the impact usually manifests itself as six to eight months, Breslin said. Equity’s CEO Mark Parrell responded to this.
"We are a lag, not a major indicator of economic change," Parrell said on the company's earnings call on Wednesday.
“People, if they lose their jobs, don’t give us the keys right away.”
Currently, renters are clinging to those keys.
Chief Operating Officer Michael Manelis said the stock had a low turnover ratio of 7.9% in the first quarter. Executive Vice Chairman Keith Oden said Camden reported a lease renewal of 3.3%, one of the highest interest rates the company has ever seen.
This is good news now. But it also marks that tenants are responding to uncertainty, and difficult times may be within scope.
Breslin outlines typical chains of events when the economic outlook becomes stumbled: tenants drop, and then they cut “wants” in their budget until they are forced to prune “demand” (and crucially rent).
The signs are there. Discretionary expenditures have decreased. According to Deloitte, it has declined sharply since November 2025, although it still surpassed the troughs in 2023 and 2024. Since February, tenants have reported higher expected costs for housing and utilities, and the signal pocket book is pinching.
"The possibility of a recession is still 60%." JPMorgan Chase frankly declared in its mid-April report.
Nevertheless, these worries have not yet shocked real estate investment. They claim.
“As of today, we have not seen any signs of consumer weakness,” said Menelis of the stock. When weaknesses do show up, it manifests as a lease breakdown, down rent advances, less renewals and delayed payments.
"No one in and said, 'Oh my goodness, I lost my job in the federal government, you need to let me lease the lease."
“We just haven’t seen it.”
But the good news is that the oversupply story seems to be in the rearview mirror, where reduced goods will increase rents unless unemployment surges.
The first quarter is the first time since 2021, and new units are rented nationwide faster than developers can deliver.
Last year, Washington, D.C. apartments exceeded apartments compared to tenant demand, according to RealPage. Then there are Houston and Las Vegas.
These scales are among the preferences of Dallas, Atlanta and Denver, equities chief investment officer Alec Brackenridge said. He added that Austin, Charlotte and Phoenix “haven’t caught bleeding from all the supplies they have suffered,” he added, but the dwindling pipeline said they will say soon.
According to broker MMG, Austin’s units are fewer units rented than they were rented in the first three months of 2025, the first in three and a half years, which records net absorption positive for net absorption.
The pipeline is still robust, but the construction is slowing down the second half of 2025, Camden's camp said. ”
After nearly two years of negative growth, according to the original investment, rent changes are now expected to turn positive by 2026.
Groups such as Avalonbay are betting on this ocean change. The company signed contracts for eight Texas multifamily real estate in the first quarter, two in Austin and the rest of Dallas-Wols-Wols-Wols-Vols-Vols-Vols-Vols-Vols-Vols-Vols-Vols-Vols-Vols-Vols-Vols-Vols-Vols-Vols-Vols-Vols in the first quarter.
"Look at the basis of where we can get into these markets," said Breslin, a Texas deal that specifies a price of $230,000 per door. By comparison, Austin's per unit price was high for $275,000 in the previous cycle.
Houston-based Camden offers Avalonbay singles on February Avalonbay, starting at Austin's Semerson in Leander for $68 million or $192,000 per unit, a 16% discount to its assessed value.
Across the Sun Belt, from 2022 to last year, the plague of value damage is operating throughout the system, while shift-focused investors are moving away from the stage.
"Lenders just kind of got it: they're not extending loans anymore; they're not expanding the rate cap," said Equity's Brackenridge.
For example, S2 Capital is a multifamily group whose sluggish overall board of riding sun belts, snapped up most of the buildings owned by GVA, a group with poor money bills.
GVA is one of the largest investors in the cycle, losing dozens of assets after interest rates soared and dozens of assets after its floating rate loans soared; it faces multiple investors alleging allegedly dark transactions.
S2 partnered with Windmass Capital, the third group, to buy one of GVA’s struggling Austin assets for $50 million in January. S2 also intervened in general partners in 1,768 units of GVA portfolios and intervened in buildings in Dallas and Nashville and Knoxville, Tennessee.
"We're seeing more products start to hit the market," Brackenridge stressed. "At the same time, it's also interesting to buy the product."
Stocks are currently combing through acquisition opportunities in Dallas, Denver and Atlanta. Unlike its peers, it doesn't have the appetite of Austin.
"The supply is too much - maybe a little bit for us," said CEO Parrell.
The three real estate investment trusts doubled as developers, saying tariffs would put pressure on fees. Avalonbay estimates the hardship costs by 5%, saying it is "enough to make certain projects unfeasible".
"Even if the cost hasn't changed, it's hard to reach an agreement now," Brackenridge said. The mix of uncertainty and still high speed complicates the math.
However, as new development activities change, contractors and subcontractors are more willing to lower their pricing, which can offset higher prices for materials.
“The contractor (the contractor) is really hungry,” Brackenridge added. “They see that the pipeline is gradually decreasing, so they accept less margin.”
Avalonbay acts as its own contractor, saying: “Our phones are on the hook with deeper bid coverage and stronger availability of subcontractors than we have seen over the years.”
"It's good," said Chief Investment Officer Matt Birenbaum.
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