DFW Joins the Map as the Cycle Quietly Inflects
A 490-unit Dallas-Fort Worth opportunity advances, the Fed trims growth and lifts its inflation forecast on tariff risk, rents stabilize unevenly, and community-bank multifamily distress hits a 12-year high. Spring brings momentum—and a clearer view of where this cycle pays.
arch was the month our pipeline broadened in a way we’ve been pointing toward for a year. We’re actively working a 490-unit project in North Dallas with a local operating partner, the first material step into a market we’ve been studying for months. The macro backdrop is also clarifying. The Fed held but trimmed its growth forecast; rent fundamentals stabilized regionally while diverging by submarket; and the next leg of distress is now visibly hitting community banks. Each of those threads informs how we’re underwriting today.
What’s New at Oakdale Capital
New market activity: Dallas-Fort Worth. DFW has long been on our short list. We’re now under way on a 490-unit project in North Dallas in cooperation with a local operating partner, and we’ve underwritten three recent DFW deals with four more in the pipeline. Supply has been heavy over the last three years, but strong job growth, corporate relocations, and inbound population gains[1] continue to drive durable demand—DFW remains one of the most dynamic housing markets in the country. We’ve calibrated our underwriting assumptions, deepened equity relationships, and are positioned to execute when the right asset clears at the right basis.
Deal flow. In addition to DFW, we underwrote two off-market deals in Louisville, one in Lexington, four in North Carolina, and one in Knoxville this month. The mix spans stabilized and value-add opportunities and reflects an active dialogue with brokers, lenders, and equity partners. Pipeline quality and volume continue to improve.
Oakdale GP Fund: $7.8M raised toward $10M. Investor interest remains strong. The Fund is advancing several promising opportunities and we continue to take new commitments—please reach out if you’d like to discuss participation.
Team. We welcomed two part-time analysts this month to support acquisitions and asset management. A deeper bench lets us underwrite faster, act decisively, and respond to investors more thoroughly.
The Fed Held—and Quietly Got More Cautious
The FOMC held the target range at 4.25%–4.50% on March 19. The bigger story was in the Summary of Economic Projections: J.P. Morgan noted that the Fed cut its 2025 GDP forecast to 1.7% from 2.1% and raised its core inflation forecast to 2.8% from 2.5%[2], with Chair Powell attributing “a good part” of the inflation revision to recently implemented tariffs. The Fed also slowed the pace of quantitative tightening, dropping the monthly Treasury redemption cap to $5 billion from $25 billion.
The 10-year softened modestly on the release, but underwriting remained tight. Equity is still requiring mild cap-rate expansion in our five-year projections, and institutional buyers continue to prefer defensible business plans and deeper in-place yield over aggressive rent growth assumptions. Transaction volumes remain below historical norms but bid-ask spreads are narrowing—an important precondition for a deeper Q3/Q4 transaction window.
Bid-ask spreads are narrowing, but many sellers are still holding peak-cycle expectations. The repricing isn’t finished.
Multifamily Performance: Steady, but Regionally Divergent
The U.S. multifamily market stabilized further in February. Yardi Matrix data via MHN[3] showed the national average asking rent rose $1 to $1,751, up 1.2% year-over-year, with occupancy holding at 94.5%. The Midwest and Northeast outperformed, led by New York (+5.6% YoY), Kansas City, and Chicago. Sunbelt metros with the heaviest deliveries—Austin, Denver, Phoenix, Nashville—continued to post declines and the sharpest occupancy drops. Single-family build-to-rent product held steady at an average $2,165 rent and 94.7% occupancy.
For our acquisitions strategy this means the underwriting assumption that gets a deal to clear has to look very different in Indianapolis or Louisville than it does in Austin or Denver. Markets that we’ve underweighted because of supply pressure—most of the Sunbelt—will eventually become attractive again, but the timing is submarket-specific. Today, we’re leaning into Midwestern and Southeastern markets where rent growth has already inflected and the buyer pool remains rational.
Construction: Permits Pulled Back Sharply
Census and HUD data[4] showed multifamily permits declined 4.3% month-over-month in February to a 404,000 seasonally adjusted annual rate, down 16% year-over-year. Starts rose 12.1% month-over-month to 370,000 units but remained 6.6% below February 2024. Units under construction held steady at 754,000 but were down 21% year-over-year. Completions dropped 20.7% month-over-month and 15.8% annually.
Starts data is noisy month-to-month; permits are the cleaner forward signal. The permit pullback supports our base case that the next wave of new supply is meaningfully slowing. For our acquisitions strategy this means the favorable supply-demand setup we’ve been underwriting toward—deliveries falling sharply while renter demand holds—is increasingly visible in the data, not just the forecast.
Distress: Now Visible at Community Banks
The distress picture broadened in March. GlobeSt reported, citing CRED iQ[5], that more than $6.1 billion of community-bank loans secured by apartment buildings are delinquent—a 0.97% delinquency rate on $629.7 billion of multifamily exposure, the highest dollar level since March 2012. Realized losses reached $504 million by September 2024, the highest since 2013, with eight consecutive quarters of upward trend.
In CMBS, the picture is starker. Multifamily distress climbed to 12.9% in January 2025, up from 2.6% one year earlier, with roughly $500 billion in commercial real estate loans set to mature in 2025. For our acquisitions strategy the signal is consistent with what we’ve been positioning for: the next twelve months will produce the best off-market opportunities of the cycle, particularly in capital structures that look fine on paper but won’t survive their refinance. We continue to invest in lender and special-servicer relationships specifically because of where this is heading.
The cleanest opportunities will be assets where the distress is capital-structure driven and the underlying housing demand remains intact.
Closing Thought
March crystallized the playbook for the rest of the year. Pricing is recalibrating, but unevenly. The Fed is on the sidelines through at least midyear. Supply is decelerating in a way that supports existing assets. Distress is broadening from CMBS into community banks, and forced sales are beginning to surface. Our work is to underwrite each opportunity on its own merits—basis, market, capital structure, business plan—and to bring patient equity to the deals that genuinely work without leaning on the macro environment.
We’re excited about what spring brings and grateful for your continued partnership. Please reach out anytime with questions or feedback—we always value your perspective.
Will Thompson
Founder & CEO, Oakdale Capital
Sources
Matthews, “Dallas-Fort Worth, TX Multifamily Market Report,” 2025. matthews.com
J.P. Morgan, “March 2025 Fed Meeting: Interest Rates Kept Steady, Slower Economic Growth Projected,” March 19, 2025. jpmorgan.com
Multi-Housing News, “National Multifamily Report — March 2025,” March 2025 — Yardi Matrix data. multihousingnews.com
Multifamily Dive, “Multifamily housing starts rose in March, but permits fell,” 2025 — U.S. Census Bureau / HUD. multifamilydive.com
GlobeSt, “Multifamily Loan Crisis Looms as Community Bank Delinquencies Soar to $6.1B,” March 4, 2025. globest.com
