A Canadian investor's deal to buy six apartment complexes across the Sun Belt is more than just the purchase of 1,600 apartments. It's also the latest bet that increasing multifamily demand is set to gain more momentum in the second half of the year as fundamentals improve.
Slate Asset Management said it's acquiring the portfolio of unspecified properties in and around Atlanta, Phoenix and Tampa, Florida. Slate identified the seller, which will stay on as an operating partner, as Tampa-based ZMR Capital, which didn't respond to an email request to comment. It's betting on a sustained need for apartments.
“We have strong conviction in the long-term demand for housing, and despite macro volatility, our investment philosophy remains unchanged; we continue to focus on acquiring below replacement cost with below market in-place rents in order to generate meaningful cash flow growth,” Peter Tsoulogiannis, a partner and the chief investment officer at Toronto-based Slate, said in a statement.
Slate's agreement to purchase the portfolio comes as apartment sales across the United States are increasing with the multifamily market's fundamentals starting to rebound.
"Multifamily investment sales gained steady ground throughout 2024, ultimately reaching $106 billion for the year — 22% above 2023 levels," CoStar Market Analytics said in a report. "That momentum extended into 2025, with first-quarter volume up 40% year-over-year and April notching a 46% gain."
Looking forward, apartment sales could gain further steam as optimism increases for the deployment of hundreds of billions in capital into North American commercial real estate in the second half of the year and sentiment builds for a strong recovery.
There are some headwinds. Developers completed construction on 608,000 U.S. multifamily units in 2024, the highest number in nearly 40 years, according to the latest full-year data from the Commerce Department and the National Association of Home Builders. Analysts have noted that a surge in apartment construction in the post-pandemic era created an oversupply in many large U.S. regions, causing rent growth to flatten.
More investment expected
Even so, leasing and rent growth have recently improved in some regions as new construction has slowed so far in 2025. There's also a substantial amount of capital held by investment funds available for commercial real estate across various firms, with London-based investment data company Preqin putting the number at more than $350 billion.
Moreover, a good chunk of the money is in the hands of large private equity and alternative investment firms such as Blackstone, Brookfield Asset Management, Ares Management, KKR, Carlyle Group, Apollo Global Management, TPG Capital and Starwood Capital Group.
As investors plot their next moves, key indicators for the multifamily market are showing signs of improvement as new construction tapers from record levels and demand among renters rebounds.
For instance, the recent wave of apartment construction has peaked in Tampa, and current demand levels are showing a major improvement over the previous year, according to CoStar Market Analytics.
Demand has also improved in several other multifamily markets including Atlanta and Phoenix, other CoStar reports show.
Meanwhile, “population growth and the increased cost of buying a home have driven a surge in demand for built-to-rent units in the Atlanta area, with the number of rental townhouses and single-family houses more than tripling in the market over the past decade,” Madelyn Bearn, an associate director of market analytics at CoStar, wrote in a recent article.
Slate, expected to close on its acquisition by month's end, also offered a favorable outlook.
"The multifamily sector is poised to benefit from highly favorable supply-demand dynamics: a structural undersupply of new housing due to declining housing starts combined with increasing demand for rental options."
For the record
King & Spalding advised Slate on this transaction.