From the Desk of CF Capital: November Investor Report

Hello, Friends and Investors.

We hope this message finds you well as we approach the end of the year! With Halloween behind us and Thanksgiving around the corner, there’s much to be grateful for. In October, we had the privilege of supporting Maryhurst—an extraordinary organization serving Kentucky's children affected by neglect and abuse—by participating in their Halloween Trunk or Treat event as part of our commitment to community service.

November is shaping up to be a pivotal month, both for our business and within the broader economic and political landscape. The results of this week’s election have brought questions and opportunities, and we are carefully monitoring how the evolving environment might impact the multifamily real estate sector. As the new administration and Congress prepare to implement their agendas, we remain focused on adapting to any shifts in market conditions that lie ahead.

CF Capital Updates and Insights

1. Election and Market Impact on Multifamily Real Estate

As the dust settles on the 2024 election, we are assessing potential regulatory and financial policy changes that could influence multifamily real estate. Political shifts are likely to impact capital markets, interest rates, and tax incentives, which play crucial roles in our investment strategy. With Republicans controlling all three branches of government, we anticipate a faster pace of policy change compared to recent years, potentially leading to substantial shifts in our industry. We will continue to analyze these developments and keep you updated on their implications for our portfolio and future acquisitions.

2. Capital Markets & Economic Trends

In September, the Federal Reserve initiated a rate-cutting cycle, starting with a 50 basis-point reduction after a period of significant rate hikes—offering some relief to the capital markets. However, rising treasury yields have offset some of these benefits, affecting the overall cost of capital within real estate. The Fed’s recent 25 basis-point cut in November and the market’s anticipation of another cut in December may bring additional relief for borrowers. Our focus remains on leveraging favorable financing options, including assumed loans with advantageous terms, to create sustained value for partners like you.

3. Recent Speaking Engagements

Our team was active at industry events this month. Tyler spoke at the Kentucky Commercial Real Estate Conference (KCREC), hosted by CCIM and the Louisville Bar Association, where he discussed trends in multifamily financing and shared best practices. This was a great opportunity to showcase our strategic approach and connect with industry leaders.

 In addition, Bryan joined CBRE’s "Behind Closed Deals" podcast, where he shared insights on multifamily investments, capital markets, and the keys to succeeding in today’s competitive real estate environment. We encourage you to listen to this episode—it offers a unique perspective on our strategy and the market dynamics shaping our approach. (Click here to watch episode)

4. New Partnership and Website Redesign

We’re thrilled to announce a partnership with Connect CREative, a highly respected agency specializing in marketing, PR, media, and web development. This collaboration marks an exciting phase for us, aimed at enhancing our brand presence and expanding our investor base. A significant part of this collaboration is the development of our new website, set to launch in January. This refreshed online presence will provide a more user-friendly experience, helping us better showcase our goals and accomplishments. Through this partnership, we expect our network of strategic partners and overall platform capacity to grow significantly, creating even more opportunities for our investor community. Stay tuned for more exciting announcements!

5. Island Club Acquisition Closing This Month

We’re pleased to announce that we’re on track to close the acquisition of Island Club Apartments, a 314-unit community in the Eagle Creek area of Indianapolis, IN. This property represents a key addition to our portfolio with its inherent value, attractive assumed debt, and low-risk business plan, aligning perfectly with our growth strategy. Renovations will begin soon, and we’re optimistic about the asset’s potential to deliver strong returns for our partners.

6. Staying the Course Amid Change

In closing, we deeply appreciate your continued trust and partnership as we navigate this dynamic market together. Our disciplined approach and commitment to creating long-term value remain at the core of our philosophy, fueling our optimism about the journey ahead. As always, please feel free to reach out with any questions about your investments or upcoming projects.

Wishing you a successful November! We look forward to closing out 2024 with even greater progress and opportunities.

In Partnership,

Bryan & Tyler

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