Hello Friends and Investors,
As March unfolds, one theme continues to crystallize: Patient capital is being positioned for the next leg of the cycle.
Over the last year, much of our focus was stabilization — navigating refinancing headwinds, protecting balance sheets, consolidating operations, and restoring certainty where markets had introduced volatility.
Today, that stability is increasingly evident. Multiple properties have been successfully refinanced, resulting in resumed distributions. Across the portfolio, renewal increases have averaged approximately 4.5% over the past 90 days, even in the middle of winter, with a 64% conversion ratio. All healthy operating signals.
While not every asset is fully optimized - the broader narrative has shifted meaningfully from stabilization to optimization. At the same time, transaction activity is beginning to return. We made five offers last week and are actively touring additional opportunities. Debt markets are competitive. Spreads remain tight. Cap rates have largely held steady and may be trending modestly downward as interest rates moderate. Yield expectations are compressing. The data increasingly suggests we have moved past the bottom of this cycle.
That does not mean euphoria. It means continued discipline; selective engagement; and being prepared when the math works. Even amid renewed geopolitical headlines - real estate fundamentals continue to advance at a deliberate, measured pace. Income streams remain durable. Capital flows adjust, but well-positioned assets endure. And we are ready.
The chart below captures what the last 15 years of private real estate have looked like. The gray bars represent income - remarkably steady through:
The orange bars represent appreciation - far more volatile.
Real estate moves slowly. Sometimes painfully so. But it has been reliably cyclical for generations.
The length of each cycle tends to be a function of the excesses or pain of the one prior. The epic run following the Global Financial Crisis was born out of deep dislocation. The correction of the last several years has reset valuations and curtailed new development, reducing forward supply pressure. This is typically the part of the cycle where patient capital is rewarded.
Not fire-sale territory. Not peak froth. But disciplined opportunity.
As we continue through our “State of the Investment” season, the progress across our portfolio is tangible:
Last year felt like shedding old skin - repairing balance sheets, consolidating operations, strengthening foundations.
This year feels different - We are increasingly focused on optimization and thoughtful growth.
CRE valuations fall below US equities for the first time in 20 years, signaling renewed investment opportunities across key property sectors.
The national median rent increased by 0.2% in February, and now stands at $1,357. This marks the first monthly increase since last July, as the market begins to pull out of its off-season pricing dip.
| “The big money is not in the buying or the selling, but in the waiting.” — Charlie Munger |
Tyler recently joined the Tenero podcast with Garrett Sutton and Katrina Loftin to discuss a topic that has become increasingly central to our philosophy: Success in real estate is about people — not spreadsheets.
Underwriting matters. Structure matters. Discipline matters.
But long-term wealth in this business is built through aligned operators, trusted partners, and strong teams. Real estate is a team sport, and durable outcomes are created through collaboration.
You can listen to the full conversation here.
The last several years demanded resilience and patience.
Today, certainty is increasing. Activity is returning. Supply pipelines are thinning. Debt markets are competitive.
We remain disciplined. We remain selective.
And we believe patient capital is being positioned for the next leg of this cycle - We are ready.
As always, thank you for your continued trust and partnership.
In Partnership,
Tyler & Bryan
Hello Friends and Investors,
Over the past few years, CF Capital’s growth has been far more moderate than our early expectations. At times, that’s been humbling. In hindsight, we’re genuinely proud of it.
What’s surprised us most isn’t the market — it’s how operational this business has truly become. Everything ultimately comes back to execution: people, systems, culture, and process. We’ve had to become far more patient than we ever imagined. But that patience has allowed us to protect capital, avoid bad deals, and build a much stronger foundation than if we’d chased scale for its own sake.
After a slower and disciplined few years, we’re starting 2026 with a real sense of momentum — not because the market suddenly got easy, but because our platform is stronger, our standards are higher, and we’re increasingly seeing the kinds of opportunities on which we’re built to capitalize.
We did not acquire a new asset in 2025 — and that was very intentional. It was a year defined by:
In an environment where many sponsors stretched, forced growth, or inherited fragile capital stacks, we chose restraint. Better to do no deal than a bad deal — especially in distorted markets. Instead, we focused on strengthening the engine:
We didn’t grow units in 2025. We grew capability.
Across our core markets — Kentucky, Indiana, Ohio, and Tennessee — fundamentals continue to look more resilient than national averages.
While national rent growth was largely flat in 2025 and vacancy rose due to the heavy 2023–2024 supply wave, most Midwest and Upper Southeast markets experienced far less new construction, helping keep occupancy relatively stable and rent growth modestly positive. Cities like Louisville, Indianapolis, Cincinnati, and Columbus benefit from:
These markets aren’t necessarily producing headline-grabbing growth — but they’re avoiding the sharper corrections seen in overbuilt Sunbelt metros. From a capital perspective, lenders and equity remain selective nationwide, but we’re seeing stronger appetite for secondary markets with stable cash flow and realistic pricing. In many of our target markets, valuations have already adjusted meaningfully, which is helping narrow the bid-ask gap and improve transaction feasibility.
Our view:
The national story is mixed. Our regional footprint continues to offer the most attractive long-term setup — lower supply risk, steady demand, and pricing that actually reflects today’s capital environment.
After spending time with operators, lenders, equity partners, and brokers at this year's NMHC, three themes stood out:
After spending time with operators, lenders, equity partners, and brokers at this year's NMHC, three themes stood out:
This combination is exactly where we believe the next cycle’s best opportunities will emerge.
Our Contrarian Lens for 2026
We will not follow the herd. The opportunities we’re most focused on don’t look flashy. They look like:
In many cases, the real opportunity isn’t bad real estate. It’s good assets trapped in the wrong structure.
We’re early — and ready to take advantage.
We believe:
We’re approaching it with:
Patience is turning into optionality.
Recent headlines surrounding the Federal Reserve have varied. On the monetary policy...
Prices fell 1.3% YOY last year, but the rate of decline moderated from 2024, according to an MSCI report.....
The last cycle rewarded speed.
The next cycle will reward judgement.
We believe CF Capital is entering this phase better positioned than ever — not because we grew the fastest, but because we built the strongest foundation.
We appreciate the trust you place in us and look forward to sharing the next chapter together.
In Partnership,
Tyler & Bryan
The CRE Finance Council’s CREFC Miami 2026 conference last week brought together commercial real estate finance experts in an atmosphere of optimism and confidence despite ongoing macroeconomic challenges. Optimism doesn’t mean turning a blind eye to the potential hurdles, though, and the Miami gathering coincided with the release of a white paper offering guidance on investment in this improving, but still unsettled, market.
Titled Lessons Shaping the Multifamily Market in 2026, the white paper from Louisville, KY-based CF Capital looks back over the past 12 months for guidance on how to proceed with the next 12. The regional real estate investment firm, which focuses on one asset class (multifamily) and four contiguous states (Kentucky, Tennessee, Indiana and Ohio) intends to illustrate “where decision-making pressure is most likely to concentrate in 2026.”
2025 ended with the Federal Reserve’s third consecutive 25-point reduction in the benchmark federal funds rate, setting the multifamily market up for what CF Capital terms “a clear inflection point.” The December rate cut elevated expectations for a reset across the capital stack, although the Fed has signaled that 2026 may bring only one additional cut.
Overview
As the multifamily industry reflects on 2025, the market enters 2026 at a clear inflection point.
After two years of elevated interest rates and muted transaction activity, the Federal Reserve’s December rate cut — its third of the year following moves in September and October — became a defining moment late in 2025, adding to the reset expectations across the capital stack. Together, the three 25-basis-point reductions brought the benchmark rate down to 3.50%–3.75% by year-end. Even so, Fed officials entered 2026 signaling caution, projecting only one additional cut this year as they wait for a clearer read on economic conditions.
For operators, lenders, and investors, the question coming out of 2025 is not whether the easing cycle has begun — it objectively has — but how quickly these cuts will translate into improved deal flow, pricing stability, and clearer underwriting.
Drawing from CF Capital’s transaction experience, market observations, and insights shared throughout 2025, this White Paper looks back at the lessons that defined the past year and outlines how they are shaping multifamily performance and investor behavior heading into 2026.
While national data provides important context, the emphasis here is on the pressures we observed on the ground throughout 2025: cap-rate shifts, operational headwinds, and the continued importance of conservative underwriting in a market where fundamentals remain sound but uneven.
These takeaways reflect not only where the market ended 2025, but where decision-making pressure is most likely to concentrate in 2026.
👉 Download the report now to explore how our investment principles and disciplined operations are creating opportunity despite today’s volatility.
| Friends and Investors, Happy New Year! January has a way of creating space—to pause, take inventory, and rethink how you’re thinking about the year ahead. For many business owners & leaders we speak with, the last few years have been productive—but not simple. You’ve kept companies growing, teams together, and capital working through an uneven economy where outcomes haven’t been evenly distributed. What we hear most often isn’t fear or hesitation... It’s discernment. A desire to work with fewer people you trust more. To simplify where capital is deployed. And to make sure the next phase of wealth creation is built on sound fundamentals—not noise. For those who’ve invested alongside us, we don’t take that trust lightly. At CF Capital, investment discipline has guided us through the current real estate cycle and demonstrated that operational excellence matters more than financial engineering. Incentives matter more than intentions. And that real alignment can’t be outsourced. These experiences strengthen how we operate, how we build teams, and how we steward capital. As a result, we enter 2026 with a level of focus and confidence we couldn’t have had a few years ago—not because the market is easy, but because our approach is sharper. |
| We’re excited to formally welcome Alex Terauds to CF Capital as our Acquisitions Principal. Alex brings deep experience sourcing, underwriting, and executing multifamily investments with an operator’s mindset and a long-term orientation. More importantly, he shares our conviction around discipline, alignment, and doing things the right way—especially in complex or uncertain environments. As opportunities begin to open up in this next phase of the cycle, Alex strengthens our ability to move thoughtfully, decisively, and in alignment with our investors. Join us in welcoming Alex to the team! |
| 2025 Review / 2026 Outlook 2025 was not a year for shortcuts—and that’s precisely why it was formative. The past 12 months reinforced a simple truth we’re carrying into 2026: the next wave of value creation in multifamily won’t come from clever structures or aggressive assumptions. It will come from execution, patience, and alignment. We recently published a short Blog reflecting on the lessons of 2025 and how we’re positioning CF Capital for the year ahead. Read 2025 Review & 2026 Outlook → |
| White Paper: Lessons Shaping the Multifamily Market in 2026 |
| We also released a new White Paper outlining the key lessons we believe will shape multifamily investing in 2026 and beyond—from operational alignment and capital structure discipline to where we see real opportunity emerging as the cycle turns. This is written for investors who want perspective, not predictions. Download the White Paper → |
| NMHC | Las Vegas – January 27, 2026 Bryan and Tyler will be attending NMHC later this month in Las Vegas. These conversations—on the ground, with operators, lenders, and capital partners—continue to reinforce our conviction that disciplined operators with staying power are going to be well-positioned in the years ahead. If you’ll be there and would like to connect, let us know → |
| From Multifamily Broker to Impact-Driven Investor and Mentor |
| Tyler Chesser is co-founder and Managing Partner of CF Capital, a private-equity real estate firm...Read Article |
| Midwest Affordability Draws Buyers |
| Midwest affordability attracts buyers with low home prices, strong wage growth, and new housing supply amid rising demand....Read Article |
| The Psychology of Money |
| by Morgan HouselDoing well with money isn’t necessarily about what you know. It’s about how you behave. And behavior is hard to teach, even to really smart people. Money―investing, personal finance, and business decisions―is typically taught as a math-based field, where data and formulas tell us exactly what to do. But in the real world people don’t make financial decisions on a spreadsheet. |
| “The ability to do well for long periods of time depends less on what you do than on what you can survive.” — Morgan Housel |
| Many of our investors are successful business owners who’ve already done the heavy lifting—building companies, creating income, and taking meaningful risk. Now, the focus is on having capital work harder for you: producing predictable cash flow, long-term appreciation, and meaningful tax efficiency while you reclaim time and flexibility. That’s who we build for. As always, we appreciate the opportunity to build alongside you, and we’re looking forward to what 2026 brings. And if you know another business owner who’s thinking more intentionally about how they allocate capital in this environment, feel free to forward this along. Here’s to a joyful, focused, disciplined, and exciting start to the year for your families and finances. In Partnership, Tyler & Bryan PS. If this perspective resonates, feel free to share it with another business owner who’s thinking more intentionally about where and with whom they deploy capital this year. |
As 2025 ends, the multifamily market finds itself in a period of recalibration rather than retrenchment. Headline narratives around interest rates, inflation and capital markets set the backdrop, but the defining forces of the year were far more practical: underwriting discipline, operational execution and market-specific fundamentals. For CF Capital, 2025 reinforced core investment principles while clarifying where opportunity continues to emerge.
Lessons From a More Selective Market
One of the clearest lessons of 2025 was that capital remains available, but only for strategies grounded in fundamentals. Lenders and institutional partners showed a strong preference for experienced sponsors, conservative leverage and business plans supported by in-place cash flow. In CF Capital’s Midwest and Southeast focus markets, assets with durable demand drivers continued to attract interest, even as credit conditions remained selective.
This environment underscored the importance of structure. Conservative assumptions, stress-tested underwriting and careful alignment between capital and business plans helped preserve flexibility throughout the year. In a market defined by uncertainty, optionality proved more valuable than aggressive leverage or speculative growth assumptions.
Wins Worth Noting
Despite a challenging backdrop, 2025 was a year of meaningful progress. Operational discipline translated into steady performance across the portfolio, particularly where NOI-focused initiatives took priority over headline rent growth. Leasing execution, tenant retention and expense management played a larger role in outcomes than broad market trends.
CF Capital also expanded its industry engagement and thought leadership, participating in many conferences and discussions focused on capital markets, underwriting and multifamily fundamentals. Equally important, communication with investors remained a priority. Clear reporting, timely market insights and transparency around strategy helped reinforce alignment throughout the year.
These wins reflect a broader emphasis on disciplined execution. In this cycle, value creation has been less about timing and more about doing the basics well, consistently and deliberately.
Market Signals That Shaped Strategy
Several trends stood out as 2025 unfolded. Capital flows varied sharply by asset quality and sponsor discipline, reinforcing the premium placed on well-structured deals. Operational fundamentals often diverged from national headlines, with local supply, demand and affordability dynamics driving performance market by market.
Debt strategy also emerged as a differentiator. As rates adjusted and volatility persisted, prioritizing fixed or hedged debt and maintaining flexibility within capital stacks helped stabilize returns. In many cases, thoughtful capital structuring proved just as important as asset selection.
Positioning for 2026
Looking ahead, CF Capital remains focused on clarity, discipline and execution. We believe 2026 will continue to reward investors and operators who align capital carefully with business plans, stay anchored in proven fundamentals and remain responsive to real-time performance data.
That means refining underwriting assumptions, stress-testing across a range of rate scenarios and maintaining a disciplined approach to acquisitions. It also means continuing to emphasize markets where population trends, employment bases and affordability support long-term demand for quality multifamily housing.
Final Thoughts
We appreciate the trust of our investors and partners and look forward to applying these lessons in the year ahead. If you’re evaluating opportunities for 2026 or want to discuss how these market dynamics may shape investment strategy, we welcome the conversation. As always, CF Capital remains focused on disciplined execution, thoughtful partnership and long-term value creation.
Congratulations to Tyler Chesser, CCIM, Co-Founder & Managing Partner of CF Capital, on being named a ConnectMoney NextGen Alternative Investment Award recipient.
Tyler’s leadership and forward-looking investment perspective continue to shape CF Capital’s approach to navigating complex markets and delivering long-term value. Well deserved.