dkaufmandevelopment

[dkaufmandevelopment]

Mid-Year Update 2025: Progress in Motion, Returns in Hand

As we cross the halfway point of 2025, we’re reflecting on what has been a transformative year for Kaufman Development and our family of platforms—including Mission10K, Grocapitus, Monarch, and the Kaufman Family Office. Each entity plays a specific role in our ecosystem, but we’re united by a single mission: deliver outsized performance through precision execution.

🚧 Project Execution: From Vision to Vertical

Our development pipeline has accelerated across multiple regions. In just the first half of this year:

Mission10K  is building over 10,000 units of attainable housing now leasing in high-growth secondary markets like Idaho, and Texas. And construction is on-going in North Carolina, Missouri, and Nevada—fulfilling our commitment to address the housing shortage where demand is both strong and underserved.

Grocapitus, our partner in data-driven site selection, helped us secure four new parcels totaling over 90 acres, all zoned and prepped for multifamily development in Florida, Nevada, and Vermont.

We broke ground on and completed entitlements for Mt. Rose, and Dixieland two cornerstone projects of our current cycle that reflect our approach to integrating architectural ambition with market fundamentals.

And in Vermont, our partnership with local stakeholders is shaping the blueprint for a new workforce housing initiative in Shelburne that blends sustainability with affordability.

💸 Investor Returns: Real Capital, Real Results

Our investors continue to see the upside of disciplined development and clear-eyed underwriting:

The Monarch Fund, which launched just 12 months ago, has now deployed over $215 million across nine projects, and already returned capital on two early-stage exits. IRRs are tracking above 22%, with multiple refinances scheduled before year-end.

Several Kaufman Family Office legacy positions were successfully recapitalized or exited in Q2, freeing up liquidity while preserving long-term optionality through preferred equity or structured JV interests.

Across the portfolio, distributions are ahead of schedule on 7 of 10 active assets, with multiple LPs reinvesting proceeds into upcoming raises.

📈 Strategy in Action: Our Edge in Today’s Market

While much of the market is still stuck in a holding pattern, we’ve kept moving. Our strategy—rooted in entitlement arbitrage, vertical integration, and mission-aligned capital—has given us the agility to advance projects even in the face of volatility.

We’re leveraging federal and local incentives, scaling in markets with population and job growth tailwinds, and actively negotiating favorable debt terms in a high-rate environment.

🔮 Looking Ahead

What’s next? More strategic acquisitions, increased internalization of GC and PM roles, and new capital formation to match the momentum.

Thank you to our partners, investors, and team members who continue to make this growth possible. We're just getting started.

Let’s keep building.

📍 Kaufman Development 🔗 www.dkaufmandevelopment.com 📥 For investor inquiries, visit investwithmonarch.com or kaufmanfamilyoffice.com 🌐 Learn more about our data-first strategy at www.grocapitus.com 🚀 Explore our attainable housing mission at www.mission10k.com

[dkaufmandevelopment]

🏗️ Vail’s Workforce Housing Milestone: West Middle Creek Rises

VAIL, CO — This summer marks a pivotal moment in Vail’s housing journey: the groundbreaking of a new 268-unit, locals-only rental development, poised to deliver crucial workforce housing to Eagle County.

Project Highlights

• 268 homes: 84 studios, 100 one-bedroom, and 84 two-bedroom units

• Parking: 257 spaces across 2 levels of podium parking, with 4 stories of living space above  

• Financing: A bold financial model funded by $10M from the town; $126M in housing revenue bonds; and $63M in certificates of participation. Bonds were oversubscribed by 8–16×, signaling strong investor interest 

• Construction timeline: Site prep is underway, with vertical construction scheduled for September 2026. Completion is expected in about three years 

Why It Matters

1. Addressing the Workforce Housing Crisis

Vail has long grappled with a critical housing shortage. Home prices average over $1 million, creating a growing deficit—around 6,000 missing beds—for essential local workers. West Middle Creek directly helps close that gap.

2. Deed-Restricted, Worker-Focused

Each unit is legally bound to a deed restriction, requiring at least one full-time Eagle County employee as the primary resident. This ensures homes stay available to local workers—not investors.

3. Strong Public-Private Partnership

This project epitomizes effective collaboration:

• Town support via direct funds and municipal bonds

• Vail Home Partners/VLHA oversight, reinforcing compliance 

Community Benefits

• Transit-friendly location: Just off North Frontage Road, it’s a short ride to Vail Village, Lionshead, and West Vail on the free town bus

• Supportive amenities: Plans include a new bus stop, fitness center, coworking area, clubroom kitchen, package room, bike storage—and sweeping mountain views

• Parking capacity: 2-level podium structure gives ample space for residents and guests

A Strategic Financial Vision

The project’s $189 million cost is backed entirely by project revenues, projected to generate $88 million of surplus over 40 years, beyond debt and operating costs. A smart, long-term investment for the town and its residents.

A Model for Mountain Towns

Across the West, resort towns from Aspen to Jackson Hole are embracing deed-restricted housing to sustain their local workforce. Vail’s InDEED program has already secured over 1,040 deed-restricted homes, with ambitious goals for 2027. West Middle Creek marks a significant next step in that strategy.

What Comes Next

• June 17, 2025: Naming ceremony & groundbreaking

• September 2026: Vertical construction begins

• By 2029: Full occupancy, accommodating hundreds of working residents

🎯 Final Take

West Middle Creek isn’t just another apartment complex—it’s a community cornerstone. It tackles the workforce crisis head-on, ensures homes are reserved for those who shape Vail’s economy, and exemplifies financial innovation in public-private housing solutions.

When local employees can live where they work, the entire town thrives—with stronger local businesses, better services, and a more vibrant, inclusive community.

Get Involved

Visit the site during the groundbreaking on June 17 or share your name ideas. Stay tuned for updates as construction takes hold and the future of workforce housing in Vail starts to rise.

Sources: Vail Daily, Bloomberg, Town of Vail, Corum Real Estate

[dkaufmandevelopment]

From Silicon to Skylines: Why Micron’s $200 Billion Chip Blitz Could Spark the Next Real-Estate Boom

If you think a $200 billion semiconductor play is just another tech headline, buckle up. Micron’s decision to blanket Idaho, New York, and Virginia with cutting-edge fabs isn’t merely a marvel of engineering—it’s the kind of catalyst that can flip entire property markets from “steady” to “scorching.” We’re talking tens of thousands of high-paying jobs, a tsunami of suppliers, and a fresh wave of government incentives—all converging to rewrite the investment math for housing, industrial, storage, retail, and commercial assets over the next decade. Let’s connect the dots.

Micron’s Mega-Bet in Three Acts

• $200 B total commitment. Roughly $150 B for new fabrication capacity and $50 B for R&D. Two new fabs in Boise, up to four in Central New York’s Clay megapark, plus an expanded Manassas campus.  

• 90 K direct & indirect jobs. Think engineers, construction crews, specialty contractors, and a sprawling vendor ecosystem. 

• Fresh federal juice. A renegotiated CHIPS Act package layers on $6.1 B in direct support, another $275 M in fast-track perks, and a House-backed 2026 tax-break expansion for manufacturing-linked real estate.  

Housing: Demand Shock Incoming

When Boise turns on its second DRAM line in 2027, thousands of six-figure professionals will need apartments, townhomes, and single-family rentals—fast. Ditto for Clay, where Micron’s own fact sheet pegs community job creation at 40,000+ on top of 9,000 staffers. Expect vacancy compression, permit spikes, and rent growth that outpaces historic norms in both metros.  

Investor angle: Entitlement plays near transit corridors, build-to-rent subdivisions, and mixed-income housing tied to local workforce grants will move to the front of the capital stack.

Industrial & Logistics: The Silent Beneficiary

A modern fab sucks in specialty gases, chemicals, and ultra-clean components on a just-in-time cadence. That means last-mile warehouses, cold-storage nodes, and truck yards within a 30-mile radius of each fab are about to become scarce—and pricey. Suppliers racing to co-locate will jolt demand for class-A industrial pads in Boise’s Treasure Valley, Syracuse’s I-81 corridor, and Northern Virginia’s tech crescent.

Self-Storage: Tiny Boxes, Big Upside

Migrating talent always shows up with skis, bikes, and college-dorm overflow. Self-storage absorption rates in Boise and Syracuse already outpace national averages; layer in thousands of relocations and you get a textbook case for ground-up facilities adjacent to new housing clusters.

Retail & Services: The 18-Hour Neighborhood Effect

High-density engineering campuses create reliable daytime traffic and a growing cohort of deep-pocketed residents after hours. That’s fuel for grocery-anchored centers, chef-driven restaurants, fitness studios, and med-tail retail—from Boise’s downtown core to Clay’s suburban arterials. Expect cap-rate compression as institutional money chases experiential retail tied to semiconductor payrolls.

Office & R&D Flex: Beyond the Fab Walls

Micron’s $50 B R&D budget foreshadows a vendor arms race for lab benches and prototyping bays. Flexible office/industrial hybrids—think 30-foot clear heights with Class-A curtain walls—will lease at tech-premium rates. Early movers controlling shovel-ready land near university partners stand to win big.

Policy Tailwinds: A Rare Alignment

Federal fast-track permitting, expanded CHIPS credits, and targeted state incentives (like New York’s “Green CHIPS” community fund) stack the deck for developers who can move quickly. For once, Washington, state houses, and corporate America are rowing in the same direction—and real-asset investors get to surf the wake. 

Silicon doesn’t thrive in a vacuum; it demands entire ecosystems of people, parts, and places. Micron’s moon-shot is the match—real estate is the tinder. From Boise’s foothills to the rolling farmland of Clay, the next wave of value creation won’t come from flipping chips, but from building the physical world those chips require. Stay tuned—I’ll be unpacking specific sub-market data and pipeline deals in the weeks ahead. Trust me, this ride is just getting started.

[dkaufmandevelopment]

🌟 2025: The Year of Opportunity at Kaufman Development, Kaufman Family Office & Our Investors

As we advance into 2025, Kaufman Development, bolstered by our Family Office and strategic investor network, is experiencing an unparalleled surge of opportunity. With a robust, diversified portfolio (exceeding $1 billion in value and over 2,500 units) , we’re not just enduring the markets — we’re defining them.

Building for Tomorrow: The Build-to-Rent Revolution

Our commitment to Build-to-Rent (BTR) communities is gaining momentum. With five active BTR projects across high-growth U.S. cities like Kansas City, Las Vegas, Reno, Raleigh , we’re launching:

• Equinox at 135th in Olathe, Kansas– a vibrant townhome-to-apartment experience.

• Equinox at Shearon Farms – 126-unit BTR project in Wake Forest.

These projects aren’t just about housing—they’re about lifestyle. Designed with energy-efficient construction, modern amenities, and sustainable planning, they attract long-term renters among young professionals, families, and retirees.

Our value proposition? Institutional-level development with community-centric features, delivering stable cash flow and resiliency in changing market conditions. With 60% of Americans unable to own homes, BTR is more than investment—it’s essential housing infrastructure .

Affordable & Workforce Housing: Project Zero

In Spokane, WA, our Project Zero pilot leveraged modular “kit-of-parts” construction: factory-built housing modules set in four days, and were fully-occupied in May of 2024 . This scalable model reduces costs and timelines, generating workforce housing for working families, aligned with community and city priorities. This success positions us to expand modular across future markets.

Strategic Land & Infill Development via Elevation Development

Our Family Office recently secured a rare 10.5-acre infill parcel in Raleigh, NC—Lake Boone—permitting 125 townhomes or 260 apartments . With $9 million in equity target and $2 million land price, this signature land development underpins our hands-on, high-upside approach. Whether as lead developer, co-GC, or advisor, this model underscores our agility and optionality.

AI and Data-Driven Deal-Making

On Mission 10K, Daniel Kaufman and Neal Bawa recently spotlighted the AI revolution in real estate: underwriting, site selection, and “data beats gut” thinking. We’re integrating these capabilities—AI-assisted zonings, algorithmic underwriting, trafficked lease prediction—into our development and acquisition velocity. And we’re backing platforms that deliver measurable advantage, not manual spreadsheets.

Case Studies: Proven Execution

• Greenview Residences: 350-unit multi-family, completed ahead of schedule and under budget. This project exemplifies our rigorous budget controls, adaptive management, and vendor partnerships .

• Affordable/Mixed-Income Projects: Through Mission 10K and our GroCapitus JV, we’ve deployed value-add strategies to deliver modern, affordable housing across underserved U.S. markets .

2025 Outlook: Why It’s Our Year

• Consumer Sentiment Dip = Opportunity: Recent readings show U.S. sentiment fell to 50.8—the second-lowest ever. While others retreat, we see this as a moment to lock in deals, reposition assets, and course-correct underwriting.

• Interest Rates & Resilient CRE: Higher rates favor multifamily and rental demand; our BTR and workforce portfolio is insulated by necessity-driven renters.

• Housing Crunch & Demographic Demand: With 60% priced out of homeownership , our product aligns squarely with urgent market needs.

Looking Ahead: What’s Next

• Scale Modular: Expand Kit-of-Parts projects into 2025 and beyond, reducing timelines and maintaining cost discipline.

• Secure Strategic Land: Focus on infill parcels like Lake Boone for optionality on BTR, build-for-sale, or mixed-use outcomes.

• Deploy AI Tools: From underwriting enhancements to lease velocity prediction and market selection (via proprietary Neighborhood Ratings), we’re driving margin and precision.

• Double Down on BTR: Adding 500+ more units across emerging and metro markets—backed by institutional-grade investors seeking yield and stability.

• Family Office & Investor Integration: Co-investment opportunities with our Family Office, offering direct access to our value-add development pipeline alongside Mission 10K syndications.

Investor Takeaway

For investors, this is an inflection year:

• Yield & Stability: BTR and multifamily deliver recurring rent flows with limited sensitivity to rate cycles.

• Execution Differentiation: With proven models in build, budget, and delivery, risk is institutionalized.

• Opportunity on Downturns: Recent sentiment dips create ground-floor investment chances—bought by cash-ready, nimble players like us.

✅ Why This Matters

2025 isn’t just another chapter—it’s a turning point. Kaufman Development and affiliated ventures are at full throttle: modular builders, data-driven developers, strategic land planners, and multifamily stalwarts. Our family office co-invests alongside capital partners, aligning align interests. For investors searching for yield with purpose and precision, the path is clear—and it begins now.

Let’s build opportunity together.

Interested in learning more or participating? Visit our platforms:

• Kaufman Development (portfolio, case studies, BTR)

• Mission 10K (syndications and thought leadership)

• Elevation Development (land development)

• GroCapitus (multifamily acquisitions)

• Oldivai (workforce housing)

Together, we’re not just developing real estate—we’re building tomorrow.

[dkaufmandevelopment]

Why Multifamily Investment Is Poised for a 2025 Comeback

If you’ve been waiting for the right moment to reenter the multifamily market, that moment might finally be here.

According to a new report from Gray Capital, “The Multifamily Window: Why 2025 Could Be the Best Buy Opportunity in Years,” the conditions are aligning for a strong resurgence in apartment investment. After several years of headwinds—soaring interest rates, record deliveries, and negative rent growth—2025 is shaping up to be a turning point. Supply is drying up. Rents are recovering. Demand remains historically strong. The window is opening—but it won’t stay open forever.

The Data Is Clear—and It’s Favorable

Gray Capital’s research draws on data from the Federal Reserve, BLS, CoStar, and CME Group to paint a compelling picture of what’s ahead. The headlines:

• Multifamily construction starts have dropped to their lowest levels since 2011.

• Absorption exceeded 550,000 units in 2024—the second-highest in 25+ years.

• Rent-to-income ratios are improving, signaling continued demand even as home prices rise.

• Household growth is outpacing new supply, a dynamic that favors owners of existing assets.

In short, the market is moving from oversaturation to constraint—exactly the kind of inflection point savvy investors look for.

Why It Matters to Kaufman Development

At Kaufman Development, we’ve weathered the same cycles that have challenged the broader market—rising debt costs, uneven rent performance, and a flood of new inventory in key markets. But we’ve also stayed focused on the fundamentals.

Those fundamentals are now flashing green.

I’m Daniel Kaufman, and our team at Kaufman Development believes 2025 will be a rare moment for those with conviction and discipline. We’ve spent the past two years sharpening our pipeline, focusing on high-conviction locations, and positioning our capital to move when others are still hesitating.

The shift Gray Capital outlines isn’t theoretical—it’s already happening. Institutional investors are reentering. Distressed owners are beginning to sell. Market psychology is turning.

A Window, Not a Runway

As Spencer Gray put it, “Multifamily investors are jaded from the last few years… That scenario is soon to be behind us.” But this next phase won’t last forever. With construction slowing dramatically, supply will remain tight for years. Those who step in now—not six months from now—will control the best assets, the most favorable pricing, and the clearest path to upside.

At Kaufman Development, we’re actively pursuing opportunities in this window. If you’re an investor looking to reposition your capital toward high-quality multifamily deals with long-term upside, we want to hear from you.

The time to move is now.

Visit www.dkaufmandevelopment.com to learn more about our investment strategy—and why we believe 2025 could be one of the most attractive years for multifamily in over a decade.

[dkaufmandevelopment]

📍 The Rise of the $1M Renter: Why the Wealthy Are Saying Goodbye to Ownership

For decades, owning a luxury home was the ultimate flex. But today, a new trend is quietly flipping that script: the rise of the millionaire renter. And if you’re developing high-end multifamily or eyeing the next wave of investor demand, this shift should be on your radar.

Millionaires Are Renting — On Purpose

Between 2019 and 2023, the number of U.S. households earning over $1 million and choosing to rent tripled. That’s a 204% increase, with nearly 13,700 millionaire renters now opting out of ownership and into luxury leases. Yes, homeownership still has its grip on the wealthy — but renter household growth actually outpaced owner growth by a wide margin (169%) during the same stretch.

So what’s driving this pivot? Think less about affordability and more about flexibility. For today’s high-earners, particularly in tech and finance, renting offers:

• Turnkey living in prime markets

• Freedom from maintenance and asset risk

• The ability to stay nimble amid market volatility

In short, it’s not about “can’t buy” — it’s about “don’t want to.”

The Southern Migration is Real — and It’s High-End

While legacy markets like New York and San Francisco remain strongholds for wealthy renters, the real growth story is unfolding in the South. Houston led the pack with a staggering 25x increase in millionaire renter households. Dallas followed at 12x, and Miami at 11x.

These cities are capitalizing on more than just warm weather and no state income tax. They’re offering:

• Newer, amenitized luxury product

• Favorable regulatory environments

• A lifestyle that appeals to the post-pandemic, remote-work elite

It’s a Generational Thing, Too

This isn’t just a regional trend — it’s a generational one. Millennial millionaires are driving a 60% surge in high-income rental households, favoring lifestyle fluidity over legacy homeownership. Meanwhile, Gen X is entering peak ownership years, and Boomers are slowly exiting the dominant position they once held in the homeowner market.

Don’t Count Out the Coasts

New York still leads the nation in millionaire renter households (5,600+), followed by San Francisco (1,400+) and Los Angeles (823). Among owners, those cities still hold the top ranks. But that edge is eroding as southern and secondary markets offer newer supply and stronger value propositions for renters who can afford anything — and are choosing flexibility over permanence.

The Bottom Line

Wealth is becoming more mobile — and so are the wealthy. The surge in millionaire renters isn’t just a lifestyle quirk; it’s a signal. Developers and investors who can deliver high-touch, low-commitment living in the right markets stand to gain in a big way. Because when luxury is a lease, the opportunity is in the offering.

[dkaufmandevelopment]

Deal or No Deal? What Every Developer Should Know Before Pulling the Trigger on a Multifamily or BTR Project

In today’s volatile environment, making the right investment call on a multifamily or build-to-rent (BTR) opportunity can mean the difference between a breakout project and a costly mistake. That’s why I’m teaming up with Neal Bawa and the team at Grocapitus for a live webinar that pulls back the curtain on how professional investors like us actually evaluate deals.

On May 28, we’re hosting a free session:

“Deal or No Deal? Evaluating Multifamily & BTR Deals Like a Pro”

— and if you’re serious about growing your real estate portfolio, you should be there.

Whether you’re a developer sizing up a new land acquisition, an investor assessing underwriting assumptions, or just trying to understand what makes one site outperform another, this is the kind of session that cuts through the noise.

Neal and I will walk through real-world examples using tools like Google Maps, zoning overlays, demographic data, and rental comps to demonstrate how we analyze opportunities from the ground up. We’ll cover:

• How to evaluate land across different markets and asset classes

• What makes a parcel viable—or not—for multifamily or BTR

• Key data signals that experienced sponsors spot long before submitting an LOI

You’ll also have a chance to engage in live Q&A and use interactive tools that reinforce the skills you’re learning.

This isn’t theory. It’s boots-on-the-ground, numbers-on-the-spreadsheet insight from two investors actively deploying capital across the country.

Join us live or sign up to receive the full replay here:

https://multifamilyu.com/lp/mission10k-dev2025/

Looking forward to seeing you there,

Daniel Kaufman

President, Kaufman Development

Managing Partner, Kaufman Family Office

[dkaufmandevelopment]

A Downtown Reset: Why LA’s Core Is Poised for a Comeback

Downtown Los Angeles is going through a recalibration—and that’s not a bad thing. In fact, for real estate developers and investors with vision, it may be one of the most attractive entry points in a generation.

While headlines tend to focus on retail and office vacancy increases, the full story—particularly in Q1 2025—is more nuanced and reveals a promising outlook for Downtown LA’s long-term transformation. The latest data from the DTLA Alliance highlights not just pain points, but also strong signals of resilience and opportunity.

The Real Story Behind Retail and Office Numbers

Yes, retail vacancy ticked up to 9.5%, driven largely by the closure of Macy’s at The Bloc—a legacy anchor struggling long before 2025. But this isn’t a collapse; it’s a clearing of outdated formats and a chance for repositioning. Forward-thinking developers are already eyeing these prime parcels for experiential retail, mixed-use redevelopment, and hospitality conversions.

The office sector tells a similar tale. Vacancy rose to 31.1%, but that’s only part of the equation. Net absorption turned positive for the first time in several quarters, clocking in at 617,905 square feet—an impressive swing from last quarter’s -601,085. Major tenants like Dentons, West Monroe, and Burke, Williams & Sorenson all renewed or expanded their Downtown presence, collectively taking down over 110,000 square feet. Leasing velocity also improved quarter-over-quarter. Translation: the office market is stabilizing, and smart capital is positioning for recovery.

Housing and Hospitality: Bright Spots with Momentum

While office and retail reset, residential and hospitality are already outperforming. Hotel occupancy jumped a full percentage point, and Average Daily Rates climbed to $221.68—up meaningfully from year-end 2024. Revenue per available room (RevPAR) also rose to $154.21. Downtown is once again a magnet for tourism and events, buoyed by the return of conventions, sports, and nightlife.

On the residential side, occupancy improved by 70 basis points, even as rents held steady at a healthy $3.38 per square foot. This suggests a growing renter base, sustained demand for Downtown living, and a stable pricing environment in the face of macroeconomic volatility.

Momentum Beyond Downtown

It’s not just DTLA showing signs of life. Across Los Angeles, we’re seeing renewed investor activity and development momentum in places like Hollywood, Culver City, and Inglewood—where Kroenke’s Hollywood Park Studios is transforming the area into a global media hub ahead of the 2028 Olympics. On the Westside, tech companies are returning to the office, sparking a wave of leasing and small-scale renovations.

Multifamily construction remains active in key submarkets, with several new permits filed in Q1. Meanwhile, city initiatives to streamline permitting and support adaptive reuse are making it easier to reposition tired assets into productive ones.

The Bottom Line for Investors

Downtown LA isn’t in decline—it’s in transition. And as history has shown, periods of transition often create the most compelling opportunities. Developers with creativity, capital, and patience are already leaning in.

Whether it’s repositioning underperforming retail, converting older offices to housing, or capitalizing on the hospitality rebound, the ingredients are here for a major renaissance. For those looking to play the long game, Downtown LA may just be the most undervalued market in the country right now.

[dkaufmandevelopment]

The Rise of the Build-to-Rent Neighborhood—and Where It’s Headed Next

The build-to-rent (BTR) model has quietly become one of the most transformative forces in U.S. housing—and it’s not just about scattered units anymore. Entire neighborhoods are being developed and operated as purpose-built single-family rental communities, reshaping the way investors and developers think about suburban land use.

According to the latest data from Yardi Matrix via Point2Homes, over 100,000 BTR units are currently in development nationwide. This follows a record-breaking 2024, in which 39,000 single-family rentals were completed—a 15% year-over-year increase.

While BTR once sat on the fringe of traditional housing strategy, it now represents a scalable, institutional-grade asset class. Today’s BTR communities blend the lifestyle appeal of suburban living with the operating efficiency of multifamily. They offer renters the privacy of a home with professional management and shared amenities—ideal for households priced out of homeownership or seeking a lower-maintenance alternative.

The Hotbeds of BTR Growth

Phoenix leads the nation with nearly 17,000 BTR units. The city has seen a more than 300% increase in BTR product since 2019, with over 4,460 new units delivered last year alone. Projects like The Bungalows on Camelback (334 units) are emblematic of this new wave—well-amenitized, lifestyle-driven, and rental-only.

But Phoenix isn’t alone. Dallas is close behind, with 14,700 units as of 2024 and 8,000 more in the pipeline. With nearly 180,000 people moving into the DFW area last year, demand for rental housing—particularly in master-planned, suburban-style communities—has never been higher.

Houston ranks third, with 8,800 existing units and a further 4,000 under development. The city saw a 187% increase in BTR inventory in just one year, and developers are continuing to chase demand in both urban fringe and exurban growth corridors.

Atlanta is seeing explosive growth, with an incredible 1,381% increase in BTR inventory since 2019. Roughly 8,100 units exist today, and more than 6,800 are under construction. With housing affordability in metro Atlanta tightening and the population swelling by 75,000 in a single year, BTR is increasingly the only viable option for many working professionals.

Charlotte rounds out the top five. With over 4,000 completed units and 5,000 more under construction, the Queen City is becoming a top-tier BTR market. It’s no surprise—home prices have jumped, and demand for rental alternatives with space and amenities continues to climb.

What’s Driving the Surge?

It comes down to affordability, flexibility, and lifestyle.

For millions of Americans, homeownership has become financially out of reach. Mortgage rates near 7% and steep down payment requirements have pushed more would-be buyers into the rental pool. BTR offers an appealing alternative: the space of a house, but without the upfront costs or maintenance headaches.

Millennials and Gen Z renters—many still carrying student debt or unable to accumulate enough savings—are driving demand. They’re looking for new construction, access to outdoor space, and community amenities, all within a flexible lease structure. That demand is being met by a new wave of developers and institutional capital eager to scale BTR portfolios across the country.

Where Do We Go From Here?

The data tells a compelling story: BTR isn’t just a niche—it’s becoming a core part of the U.S. housing strategy. As affordability pressures persist, expect more suburban master-planned BTR neighborhoods to emerge—not just in the Sun Belt, but in high-barrier markets like the Midwest and Northeast as well.

For developers, it’s an opportunity to rethink how we approach suburban land. For investors, it’s a scalable and stable asset class with long-term demographic tailwinds.

Want to know which secondary markets are heating up next—and who’s quietly assembling land?

Stay tuned for our next post, where we’ll break down emerging BTR opportunities before they hit institutional radar.

[dkaufmandevelopment]

Tariffs Are Up—But Smart Builders Aren’t Panicking

If you’ve been skimming the headlines lately, you’d think the sky was falling on U.S. housing development:

“25% Tariff on Steel!”

“Canadian Lumber Hit With 20% Duties!”

“Chinese Cabinets Face 25% Import Tax!”

It’s enough to make any investor or builder assume that new construction budgets are getting blown to pieces.

But here’s the truth: the actual financial impact is real—but far more nuanced than the headlines suggest.

What Tariffs Are Really Adding to the Cost of a Home

The National Association of Home Builders (NAHB) estimates that tariffs have added between 6% and 9% to the cost of constructing a typical single-family home. On a $400,000 build, that’s roughly $24,000 to $36,000.

The biggest contributors? Lumber, steel, aluminum, and imported finishes from China—think cabinets, lighting, fixtures, and flooring.

It’s a meaningful hit, especially in an environment where affordability is already under siege. But this isn’t a market killer—it’s a margin challenge, and savvy developers know how to manage those.

Why the Numbers Aren’t as Scary as They Sound

Let’s break it down:

• A 25% tariff on steel sounds steep—but steel only makes up 5% to 7% of a home’s total construction cost.

• Canadian lumber carries a 20% duty, but framing generally represents 15% to 20% of the overall cost.

• Many developers are sourcing materials domestically or restructuring supply chains to avoid the worst of the pricing pressure.

More importantly: land and labor costs have outpaced tariffs in driving home prices. In most markets, that’s where the real pain is.

A Real-World Snapshot

Say you’re building a 2,400-square-foot home:

• Pre-tariffs: ~$320,000 to build

• Post-tariffs: ~$340,000 to $350,000

• That’s a $20k–$30k bump—serious, but not catastrophic.

If the buyer’s financing with a 30-year mortgage, that might only raise their monthly payment by $120–$150, depending on rates.

How Smart Developers Are Staying Ahead

The builders who are winning right now aren’t just absorbing cost increases—they’re reengineering how they build.

Here’s what they’re doing:

• Leaning into prefab and modular construction to reduce labor needs, trim waste, and speed up delivery.

• Tightening logistics and purchasing strategies to order smarter, bundle materials, and avoid tariff-heavy suppliers.

• Reallocating capital toward tech-enabled build systems and offsite fabrication to stay ahead of the curve.

In short: it’s about efficiency, not just expense control. The firms that adapt fastest will continue to underwrite successful deals—tariffs or not.

At Kaufman Development, we’re focused on building smarter—not just bigger. Our strategy integrates advanced construction methods with real-time supply planning to keep projects viable, even in a high-cost environment.

Explore how we’re turning today’s pressure into tomorrow’s opportunity.

Visit: www.dkaufmandevelopment.com

[dkaufmandevelopment]

Got a project but still need funding?

Monarch Fund One is actively sourcing new opportunities in senior housing, industrial real estate, and hospitality. If you’re an experienced developer with a compelling site and a strong track record, you may qualify for up to $25 million in direct capital from our fund.

Our in-house team moves fast — we underwrite in real time, make decisions quickly, and partner with you to bring your vision to life.

Let’s make it happen.

📩 Drop us a message or comment below to connect.

About Us

Monarch Fund One is a strategic initiative backed by the Kaufman Family Office and Kaufman Development — a real estate and investment platform with deep roots in development, finance, and innovation. With over $2 billion in assets under management, our group focuses on high-impact, long-horizon investments across the country.

At Kaufman Development, we design and deliver bold, purposeful projects that shape communities. Through the Kaufman Family Office, we invest across asset classes with a contrarian eye and a developer’s mindset.

Learn more:

kaufmanfamilyoffice.com

dkaufmandevelopment.com

[dkaufmandevelopment]

NOW OPEN: Monarch Fund 1

$250M Target | $100M Ready to Deploy

We just launched Monarch Fund 1 — a $250 million contrarian play designed for family offices and ultra-high-net-worth investors who think ahead of the herd. $100 million is locked and loaded for immediate deployment.

What we’re focused on:

• Senior Housing

• Industrial

• Hotels

Why it matters:

Backed by Grocapitus + Kaufman Group

Built around data gaps, flexible capital stacks, and co-GP alignment

Led by Neal Bawa and Daniel Kaufman — two names that define smart timing and execution

Minimum: $25M investment

This isn’t for everyone. But if it’s for you — you’ll know.

DM us for details or deal flow.

Let’s build something enduring.

[dkaufmandevelopment]

Huge day for us 🚀

After years of planning, Monarch Fund 1 is officially launched and open for deployment — $100M ready to deploy on Day 1.

We are going to deploy the $250M fund to co-GP with the best of the best in Senior Housing, Industrial, and Hotels. We are multifamily and BTR experts, and today, we are expanding into three new verticals, starting with a $100M deployment.

We’re investing where others are hesitating. We believe a new real estate cycle will start within the next 12 months, so this is the time to deploy smart capital. The best deals will be gone in 12 months.

Spots are open in Monarch Fund 1 for Family Offices, Institutional investors, and UNHW. Minimum investment is $25M. We’re deploying flexible capital fast, aiming to catch the sweet spot of this market cycle with our data-driven advantage 📈.

If you’re a contrarian investor looking for an edge — Monarch is open for business.

DM me if you want to be an investor or a partner in Monarch Fund 1.

[dkaufmandevelopment]

Manhattan’s “Class B Moment” — And Why Only the Strong Will Survive

Over the past few years, Manhattan’s office market has been a story of extremes—soaring Class A trophy towers on one side, struggling lower-tier assets on the other. But right now, something unusual is happening: Class B office space is suddenly the hottest ticket in town—just as its supply is rapidly disappearing.

Let’s break down what’s happening.

When Class A Fills Up, B Steps In

With premier Class A towers hitting near-full occupancy, leasing demand is now spilling over into B-plus buildings—the older but well-located assets that have just enough modern upgrades to attract major tenants.

The numbers don’t lie: 8 million square feet of Class B space was leased in Q1 2025 alone, the highest post-pandemic figure and nearly 25% above the 10-year average. Demand is real, and it’s growing.

Supply Is Tightening — Fast

Here’s the kicker: just as Class B becomes the market darling, supply is vanishing.

Zoning changes and aggressive tax incentives are fueling office-to-residential conversions, and it’s the Class B sector that’s getting hit the hardest. Since 2020, more than 6.5 million square feet of Class B offices have already been converted to housing—and pending projects could triple that.

Conversions aren’t just erasing inventory—they’re displacing existing tenants, creating even more competition (and more urgency) among businesses trying to lock down space.

Meanwhile, sublease availability keeps shrinking. We’ve now seen eight straight quarters of decline, with only 3.33 million square feet available—the lowest since July 2020. Tenants aren’t leaving. Companies are calling people back to the office. And the window to grab space is getting narrower by the day.

Why Tenants (and Investors) Are Flocking to Class B

Simple: pricing and positioning.

In places like Midtown South, Class B rents are often $25/SF cheaper than comparable Class A spaces. For many tenants, that’s a no-brainer. But there’s a catch: today’s tenants aren’t just looking for vintage charm—they want turnkey buildouts, sleek interiors, and amenities that feel closer to Class A standards.

That means landlords are spending Class A money to attract and retain tenants—often squeezing margins to the bone unless they have deep pockets and a smart capital strategy.

Big Names Are Betting on B

Some major players are planting flags in Manhattan’s best-located Class B buildings:

• Amazon (via WeWork): 303,741 SF

• IBM: 92,663 SF at One Madison

• Horizon Media: 360,000 SF, 17-year lease

• Goodwin Procter: 250,000 SF in a beautifully restored 116-year-old building

• Moves from BuzzFeed, Capital One, A&E, and even the Archdiocese of New York round out the trend.

The credibility of these tenants is giving other companies the confidence to follow.

Class B is having its moment—but it’s not built on an invincible foundation.

Yes, demand is strong, and yes, supply is tightening. But margins are thin. Landlords are being asked to invest heavily. And the whole model depends on tenants willing to pay near-Class A rents without a true Class A experience.

If the tech sector stumbles or the economy cools, this surge could dry up fast.

In the meantime, only landlords with strong balance sheets, smart renovation strategies, and patient capital are positioned to capitalize on this “B-is-the-new-A” era.

At Kaufman Development, we’re closely watching how this plays out—not just in Manhattan, but in every major market where adaptive reuse and repositioning are rewriting the rules of office leasing.

Stay sharp out there.

— Daniel Kaufman

President, Kaufman Development

[dkaufmandevelopment]

Where Renters Are Getting Priced Out—and What It Means for Developers

By Daniel Kaufman

Housing affordability is a headline topic—but the real story often gets lost in the metrics. Most affordability maps rely on median household income, which includes homeowners and skews the reality for renter households. That’s where the latest data from John Burns Research and Consulting cuts through the noise—offering a renter-specific lens that’s far more telling for those of us building the next generation of housing.

The takeaway? We’re looking at two Americas.

In metros like Pittsburgh and Indianapolis, renters need to allocate less than half their income to afford the monthly payment on a typical home. But head to the coasts—Los Angeles, San Jose, New York—and the math completely breaks down. Renters in those markets would need to spend over 100% of their income just to cover a typical mortgage. Homeownership isn’t just out of reach—it’s a fantasy.

Here’s how the numbers shake out among metros with populations over 1 million:

Top 5 Most Affordable Metros for Renters

(Share of income needed to afford the monthly payment on a typical home)

1. Pittsburgh, PA – 43%

2. Indianapolis-Carmel-Greenwood, IN – 44%

3. Memphis, TN-MS-AR – 46%

4. Rochester, NY – 46%

5. Oklahoma City, OK – 46%

Top 5 Least Affordable Metros for Renters

1. San Jose-Sunnyvale-Santa Clara, CA – 112%

2. Los Angeles-Long Beach-Anaheim, CA – 109%

3. San Francisco-Oakland-Fremont, CA – 101%

4. San Diego-Chula Vista-Carlsbad, CA – 93%

5. New York-Newark-Jersey City, NY-NJ – 92%

What This Means for Developers

This isn’t just a data point—it’s a call to rethink how and where we build. In ultra-cost-burdened markets, we’re watching a generation of renters become permanent renters. The demand for innovative rental housing—build-to-rent communities, modular multifamily, and co-living formats—has never been stronger. Meanwhile, affordability in secondary and tertiary markets presents a strategic entry point for long-term, yield-driven development.

If we want to build for where the puck is headed, we need to start with where renters actually live—and where they can afford to stay.

Daniel Kaufman is President of Kaufman Development. Explore more insights at www.dkaufmandevelopment.com.

[dkaufmandevelopment]

Cap Rates Settle In as CRE Investors Regain Their Footing

Posted by Daniel Kaufman | Kaufman Development

After a turbulent couple of years, we’re finally starting to see a theme emerge across commercial real estate: stabilization.

Investor demand is picking up steam across core CRE sectors, and while pricing remains a moving target in some areas, cap rates are beginning to settle. It’s not a boom—it’s a recalibration. And in today’s market, that’s worth paying attention to.

Retail: Still a Crowd Favorite

Retail continues to punch above its weight. Despite a slight 1.69% dip in median sale prices (now sitting at $259.54 PSF), investor appetite is strong—especially for grocery-anchored centers and essential service tenants. With construction costs still sky-high, new retail development is limited, driving more competition for existing assets.

Cap rates held steady at 6.7%, and lease rates are healthy—$18.89 PSF on average—with only a minor dip in effective rents. Retail may not be sexy, but it’s proving sticky and resilient.

Office: Signs of Life

Office isn’t dead—it’s just evolving. Sale prices jumped 15.6% YoY, now averaging $231.71 PSF, a signal that capital is returning to Class A spaces in CBDs as return-to-office momentum slowly builds.

Vacancy inched up to 14.1%, but with fewer move-outs and stabilized leasing, the sector’s floor is looking firmer. Cap rates compressed to 7.5%, and with asking and effective rents now near $19 PSF, landlords are gaining a bit more leverage.

Industrial: Holding Strong

Even with a 1.4% decline in sale prices, industrial is still a top target. Cap rates rose slightly to 7.27%, but investor demand remains robust, especially for last-mile logistics and assets near transportation nodes.

With e-commerce still anchoring demand and supply chains continuing to evolve, industrial is likely to remain a cornerstone of most institutional CRE portfolios.

Multifamily: Solid Demand, Pricing Adjustments

Multifamily remains fundamentally sound—absorption clocked in at 1.62% in March—but pricing is still finding its balance. Sale prices dipped 2.5% YoY to $163.09 PSF, while cap rates for closed deals averaged 6.54%.

The real story is the gap between asking cap rates (7.11%) and what’s getting done. It’s a classic bid-ask standoff, and higher interest rates haven’t made it any easier. That said, value-add investors with long-term vision are finding plays in high-growth secondaries.

Why It Matters

We’re entering a new phase. Pricing isn’t collapsing—it’s settling. Cap rates are no longer bouncing all over the place. And in a capital market environment still defined by caution, that’s a meaningful shift.

Retail and industrial are leading the way. Office and multifamily are catching a bid. And everywhere you look, there’s one common thread: investors are back at the table, but they’re picking their spots carefully.

What to Watch Next

Heading into mid-2025, we expect:

• More capital flowing to essential retail and last-mile logistics

• Strategic bets on Class A office in walkable urban cores

• Renewed interest in multifamily with value-add or operational upside

In other words, this isn’t a market for tourists—but for developers and investors who know how to work through a pricing reset, the next few quarters could offer the best entry points we’ve seen in years.

[dkaufmandevelopment]

Tariffs, Timing, and a Surprise Win for Multifamily Developers

By Daniel Kaufman

Sometimes, the market hands you a break without even meaning to.

Back in 2023–2024, we watched a flood of new multifamily units hit the market—over 1.1 million, the largest delivery wave since the 1980s. At the time, it felt like oversupply. Rents softened. Concessions were everywhere. Developers questioned their timing.

Now? That “glut” is starting to look like an asset.

With Trump’s tariff wave back on—including proposed 145% tariffs on Chinese building materials—and construction costs spiking again, multifamily owners with stabilized properties are suddenly in a strong position. It’s a classic case of bad news for builders = good news for landlords.

Rents Rising. Buyers Waiting.

Mortgage rates are still hovering above 6.5%. Buying a home is now about 30% more expensive than renting. That’s keeping would-be buyers on the sidelines—and renewals are surging in markets like Manhattan, where net effective rents are at record highs.

The result? Renters are staying put. Builders are hitting pause. And existing inventory is getting absorbed faster than expected.

The Supply Squeeze Is Real

New development is slowing. Developers are grappling with material cost hikes, labor shortages, and capital constraints. Meanwhile, landlords are forecasting rent hikes of up to 5% annually as supply tightens and demand holds.

At Kaufman Development, what we once viewed as a temporary oversupply is now revealing itself as a strategic advantage. Lease-up concessions are fading, pricing power is strengthening, and the fundamentals are aligning for a potential rent rebound.

Not All Boats Rise

This dynamic isn’t kind to everyone. Homebuilders still mid-project are facing the double-whammy of tariff-driven cost hikes and slowing sales. Renters, meanwhile, are caught in the middle—facing fewer affordable options and rising lease renewals.

But for apartment developers who got in early—who delivered before the cost wave hit—this moment offers a rare edge: a stabilized asset in a high-cost, low-supply environment with less competition and rising demand.

The Bottom Line

What started as an oversupply problem is turning into a pricing advantage. With fewer projects in the pipeline and fewer renters buying homes, multifamily operators like Kaufman Development are poised to benefit from one of the more unusual tailwinds we’ve seen in years.

Smart timing—or just lucky? Either way, it’s a win.