‘Huge’ investor demand for apartment buildings

A version of this article first appeared in the CNBC Property Play newsletter with Diana Olick. Property Play covers new and evolving opportunities for the real estate investor, from individuals to venture capitalists, private equity funds, family offices, institutional investors and large public companies. Sign up to receive future editions, straight to your inbox.

Fundamentals in the multifamily apartment market are weakening as a historic surge of new supply continues to make its way through the pipeline and rental demand falls back. At the same time, investor demand for these properties is rising.

As an example, Camden Property Trust, a top-10 multifamily real estate investment trust, quietly began marketing its entire California apartment portfolio — 11 properties valued at roughly $1.5 billion — a few weeks ago and has already had significant interest. 

“We have a huge demand for it right now,” Ric Campo, CEO of Camden, told CNBC. “Not two or three, but hundreds.”

Campo said the company wants to focus entirely on the Sun Belt, which is where 90% of its properties are now. 

“We think the Sun Belt markets are going to — once they recover, which should happen, we think in ’26 or ’27 — they will be better growth dynamic markets than California and our long-term cash flow growth, or net operating income growth, will be better concentrated in the Sun Belt than Southern California, so it’s fundamentally why we’re selling.”

As for the timing, he said poor fundamentals are actually fueling demand. 

“You’ve had no rent growth, yet you’ve had wage growth, and so affordability for apartments across America has gotten better,” Campo said. “And at the same time, if you look back at the last 20 years, only during really complicated recessions or the financial crisis have apartment rents stayed flat for more than a year or two, and so the market believes fundamentally that there’ll be a turn in the market.”

Rents started 2026 on a low note, with the national median in January down 1.4% year-over-year, the largest annual drop since September 2023 and the lowest January rent since 2022, according to Apartment List. Rents are now more than 6% lower than their last peak in 2022. 

Rents are falling because of rising vacancies. The national vacancy rate was 7.3% in January, a record high on Apartment List’s index, which dates back to 2017. Units are also taking an average of 41 days to get leased, four days more than in January 2025 and another high for the index. 

“We’re past the peak of a multifamily construction surge, but a healthy supply of new units are still hitting the market and colliding with sluggish demand, causing vacancies to continue trending up,” said Chris Salviati, chief economist at Apartment List. 

More than 600,000 new multifamily units hit the market in 2024, the most new supply in a single year since 1986. That came down to 500,000 in 2025, and 2026…