April 2026 Update: Welcoming Mark McRoskey

We are pleased to introduce Mark McRoskey, who joins us as Director of Capital Markets.

Mark brings ten years of private and institutional real estate investment experience, with a track record spanning equity sourcing, deal execution, and investor relations across multifamily, office, industrial, retail, and land. He has worked on the structuring and closing of over $300M in commercial real estate acquisitions and dispositions, and has served as a primary point of contact for high-net-worth individuals, family offices, and institutional partners throughout his career.

Most recently, Mark was Director of Capital Markets and Investor Relations at ColRich, where he spent nearly four years. He holds a BBA in Finance from Gonzaga University.

Mark's focus at Cores will be leading capital markets and capital raising activity - equity sourcing, deal execution, and investor engagement across our growing portfolio.

We are happy to welcome Mark to the team and you will be hearing from him shortly.

The following is our regular monthly overview of the market and how we are responding to the developing trends.

THE MACRO BACKDROP

Persistent inflation and a higher-for-longer rate environment continue to define the operating context. February shelter costs kept core inflation elevated; the Fed has signaled rates stay on hold, with Powell acknowledging progress toward 2% will be slower than anticipated. For value-add sponsors dependent on debt financing, borrowing costs remain the binding constraint.

Labor markets are softening modestly - payrolls slowed, unemployment ticked up - but demand fundamentals remain intact. No deterioration; just less momentum.

SUPPLY: THE STORY IS TURNING

The most important development of Q1 is supply compression. National multifamily deliveries dropped roughly 30% year-over-year, falling below 400,000 units for the first time since early 2023. Construction starts are at their lowest since 2016.

In the Southeast, pipelines in Atlanta, Charlotte, and Jacksonville are clearing faster than most operators anticipated. Repositioned assets in these markets face less lease-up competition from new Class A product than at any point in the recent cycle.

Cushman & Wakefield's Q1 MarketBeat shows Sunbelt markets leading national absorption - Dallas/Ft. Worth absorbed 5,300 units, Charlotte 2,500 - both top-five nationally despite demand normalizing to 65,200 units absorbed overall.

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THE VALUE-ADD PROBLEM

Supply relief does not solve the underwriting problem. Class A vacancy fell roughly 80 bps over the past year as renters traded up; Class B and C vacancy increased by a similar margin. National asking rents rose only 0.9% year-over-year.

The current market is running against Class B/C operators who haven't yet executed their renovation programs. Rent premiums need to be in place, not projected. A recent review of 15 Southeast deals - passing on all but one - illustrates the discipline the market now demands. The deal that cleared was a 400-unit early 2000s asset at $215K/unit with $350/month premiums already achieved on 40% of completed units. In-place proof-of-concept, basis 20%+ below replacement cost. That is the standard.

INSTITUTIONAL CAPITAL: READING THE SIGNALS

Two data points are worth noting. Carmel Partners closed its $1.35B Fund 9 in April, pivoting explicitly from development to acquiring operating assets - but targeting coastal gateway markets, not the Southeast. American Landmark's Fund V, at a $400M first close with a $1B target, is explicitly Southeast-focused, covering Atlanta and Dallas.

Institutional money is differentiating. Coastal capital is chasing supply-constrained gateway plays. Sun Belt-focused capital is concentrating on operators with demonstrated repositioning track records and in-place performance.

WHAT WE'RE WATCHING

Rent growth trajectory in Atlanta, Charlotte, and Jacksonville as supply clears. Exit cap rate assumptions relative to current transaction evidence. Renovation cost inflation and its effect on value-add spreads.

THE TAKEAWAY

The supply setup in the Southeast is improving materially. The underwriting discipline required to capitalize on it has not changed: proven rent premiums, conservative exit assumptions, and basis well below replacement cost. The pipeline compression is real. Proforma rent growth is not a substitute for demonstrated performance.

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