Although apartment owners in certain areas of the country have enjoyed unparalleled highs since late 2020, not everyone has shared in the gains.
Some owners, particularly in large coastal cities, have been hit with the double whammy of eviction moratoriums and the migration of residents out of central business districts, suppressing both revenue and occupancies.
In addition, the Federal Reserve started hiking interest rates in spring 2022, leaving owners with floating-rate loans with much higher borrowing costs at a time when other expenses, like taxes and insurance, were also increasing. If a company bought at the top of the market, those problems were magnified even further.
Earlier this year, reports of problem loans in San Francisco and New York City began to leak out. As the year progressed, foreclosures in Houston gained steam. While delinquencies and servicing rates continue to be relatively low in multifamily, especially compared to other sectors like offices, issues still persist and could snowball in 2024 as more owners grapple with rising loan costs, experts say.
Here, Multifamily Dive rounds up the problem loans that have come to light since January 2023. Please check this page for regular updates.