Your March Newsletter from CALCAP!

CALCAP CONNECTIONS

March 2026

Principal's Corner

Navigating the Reset: How Disciplined Operators Win in a Post-Peak Market

By Edward Aloe, Founder and CEO California Capital Real Estate Advisors, Inc. (CALCAP)

The multifamily market remained challenged for the last 3 years as the sector continued to absorb a historic wave of new supply and the full impact of "higher-for-longer" interest rates. So far, the widely predicted wave of distress hasn't played out as a sudden, catastrophic crash. Instead, we are living through a gradual reset. Values are adjusting, capital structures are being reworked, and expectations are shifting. It just isn't happening all at once.

For institutional allocators and RIA platforms, this transition phase requires a fundamental pivot in strategy. The era of inexpensive, plentiful debt lifting all boats is clearly over. Today, operational execution matters more than ever. At CALCAP, we believe the next 24 to 36 months will define the winners of the next cycle. By focusing on workforce housing fundamentals and executing a disciplined operational strategy, we are preparing for the best acquisition vintage since we started the company during the Great Financial Crisis.

This paper examines the structural shifts in cap rates and supply, the critical importance of disciplined asset management, and why the window for capital deployment into multifamily is opening now. The reset is real, and for those paying attention, it's exactly where the

opportunity begins.

Read the Full White Paper Here

Edward M. Aloe

President and CEO

626-229-9057

Welcome to the Real Estate Wealth Podcast, where we explore real estate as the most proven way to financial freedom. Join us for insights with leading experts and discover how vibrant health and an abundance mindset are keys to true wealth.

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Latest Headlines...

America has a housing affordability crisis. Building houses for rent can help

Homeownership has long been a central part of American culture; it's a way to put down roots in a community. and one of the main ways people build wealth.

But that may be changing as more people embrace long-term renting. A recent survey of 1,000 Americans renting single-family homes conducted by the Center for Generational Kinetics, a research center studying the different mindsets between generations, found that only 8% of those renters defined the American dream as owning a home.

Still, the real estate world is short on supply for renters too. In 2024, the U.S. had about 800,000 fewer single-family houses for rent compared with a decade earlier, according to the National Association of Realtors. Some of that is due to investors selling off their rental houses to homebuyers.

View Article Here

My Top 5 Predictions for Multifamily Owners, Operators & Investors

A disciplined reset today sets up a materially stronger cycle ahead. Here's how 2026 is likely to unfold and where strategy, patience, and selectivity matter most.

1. National rent growth remains modest but decisively positive

Advertised rents are projected to increase approximately 1–2% nationally in 2026, extending a third consecutive year of muted growth. This is not a demand failure, it's the natural digestion phase following the 2023–2025 construction wave. As deliveries decelerate and household formation persists, the market is positioned to tighten meaningfully into 2027, setting the stage for improved pricing power.

2. Supply not demand, is the primary swing factor

Approximately 450,000 multifamily units are expected to deliver in 2026 down from peak levels, but still elevated relative to long-term averages. Performance will diverge market-by-market based on how quickly new supply slows versus absorption, not on a collapse in renter demand. Markets with even modest supply relief will outperform quickly.

3. Low-supply Midwest and Northeast markets outperform on rents

Select Midwest and Northeast metros including Chicago, Philadelphia, Detroit, and secondary markets with zoning and entitlement constraints are positioned for above-average rent growth. These markets benefit from stable demand, lower construction pipelines, and replacement-cost support, creating a favorable setup for existing owners.

View Article Here

Multifamily rent growth ended 2025 flat nationwide, but fundamentals are showing signs of stabilization

According to Yardi Matrix, average asking rents fell by $1 in December to $1,718, leaving year-end rent growth at just 0.3 percent. That marks a sharp deceleration from the gains seen in 2021 and 2022 as the sector continues to digest record new supply. Occupancy held relatively firm at 94.7 percent, suggesting demand remains steady despite heavy deliveries.

Roughly 445,000 new units were absorbed nationally in 2025, the highest on record. While that level of absorption is encouraging, it was not enough to keep rents growing in high-development markets like Austin, Atlanta, and Phoenix, where concessions remain widespread. In contrast, metros with more limited construction pipelines such as Chicago, New York, and parts of the Midwest saw modest rent gains and greater pricing stability. Gateway markets are also benefiting from slower construction timelines and a rebound in urban renter demand.

The single-family rental segment also saw a shift in 2025. Advertised rents declined 1.0 percent year-over-year, marking the steepest drop in over a decade, but occupancy remained solid at 94.9 percent. Operators are increasingly focused on maintaining high occupancy and lease stability rather than pushing rents, especially in high-supply Sunbelt markets.

View Article Here

On the Lighter Side...

About CALCAP Advisors

About CALCAP

California Capital Real Estate Advisors (CALCAP) is a Pasadena-based real estate investment firm founded in 2008. The Company sponsors and manages alternative investment opportunities focused primarily on workforce and attainable housing in growth-oriented U.S. markets.

Since inception, CALCAP has navigated multiple market cycles with a disciplined, research-driven approach centered on capital preservation, operational execution, and long-term value creation. The firm partners with both individual and institutional investors and currently oversees approximately $650 million in assets under management.

CALCAP’s strategy emphasizes selective acquisitions, conservative underwriting, and active asset management designed to deliver durable, risk-adjusted returns across varying market conditions.

To learn more visit www.calcap.com.

Social Impact

CALCAP CARES is the firm’s 501(c)(3) private foundation, created to support the communities where we invest and operate. The foundation encourages team members to give back locally and contribute to causes that strengthen neighborhoods and families.

A primary focus of CALCAP CARES is supporting organizations that serve individuals and families affected by autism. Through financial contributions and community engagement, we aim to make a meaningful difference in the lives of those navigating the challenges associated with autism while reinforcing our broader commitment to community impact