Dive Brief:
- Apartment sales volume rose 9% year over year to $165.5 billion in 2025, climbing across every subtype and metro tier, according to a report that data firm MSCI Real Assets shared with Multifamily Dive.
- While 2024’s trades were driven by large one-off sales, like Blackstone and Denver-based Apartment Income REIT Corp.’s $10 billion deal, volume climbed at a faster pace in 2025. “Deals of that size do not happen every year and growth in volume in total was challenged for 2025 with the high hurdle set the year before,” MSCI said in the report.
- Prices still fell in 2025, but the rate of decline moderated from 2024. The Real Capital Analytics commercial property price indexes for multifamily dropped 1.3% YOY, according to MSCI. In 2024, prices dropped 3%. Cap rates have remained at 5.7% for the past eight quarters.
Dive Insight:
In 2025, only $354 million in apartment entity-level deals occurred, a 96% decline from 2024. However, individual asset sales, often a benchmark for sector health, rose at a 20% clip to 136.8 billion, according to MSCI.
“This pace of growth is a clearer signal of market trends as investors underwrite acquisitions one property at a time,” MSCI wrote. “There are no portfolio effects to paper over mistakes in underwriting, and the growth in deal volume shows that investors are becoming more comfortable with the income story presented by the sector.”
Mid- and high-rise trades increased 7% YOY to $69.6 billion in 2025. Garden property transactions rose 11% YOY to $95.8 billion.
With vacancy rates for institutional-quality apartments rising from the lows in 2022 and rents falling from previous highs, MSCI questioned whether investors were jumping into the market at the wrong time.
However, it noted that buyers are looking beyond current issues to future income growth. It's much easier for investors to look beyond a shaky near-term rent outlook if they can get properties at a discount.
For instance, Heitman recently announced the final close of Heitman Value Partners Fund VI, its largest closed-end fundraise to date, according to a Jan. 20 press release. The vehicle received commitments totaling $2 billion, exceeding its $1.75 billion target and reaching its hard cap.
Mike Trench, executive vice president and co-portfolio manager of Heitman’s value series, told Multifamily Dive in emailed comments that Heitman believes in the near-term growth prospects for apartments, given that most markets have moved past peak deliveries.
“The backdrop, at the highest level, of the U.S. still being under-housed alongside the value reset the market has experienced due to higher interest rates that last few years makes for a compelling entry point as well,” Trench said.
While Heitman is always looking for “access points in favored sectors like apartments and student accommodations resulting from distress,” those opportunities have been few and far between, according to Trench.
However, others say they’re seeing distress.
Earlier this month, American Landmark Apartments completed the first close of American Landmark Fund V, raising approximately $400 million in equity commitments, to buy mid-priced, income-producing class A and class B market-rate assets throughout areas with high job and population growth.
The firm is also beginning to see significant buying opportunities from distressed properties, CEO Joe Lubeck said.
“Over the last two years, we saw lots of distress, but primarily in the class C apartment category, which was not of interest,” Lubeck said. “We’re now seeing that there are some of these builders who are unable to stabilize or refinance without bringing cash to the table because their leverage was too high. As a result, we’re seeing opportunities to buy.”
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