Vine Capital Partners | February Update
Updated: Mar 13
Since June 2022, the FED has aggressively raised rates 6 times, with the latest hike just several days ago. Fortunately, on our recent apartment acquisition (Windsor Terrace), we purchased an interest rate cap. A rate cap limits how high the rate, on a variable-rate loan, can increase in the event of aggressive rate hikes. Rate increases continue to put pressure on lending, and there has been a significant slowdown in inventory of multifamily assets. Unfortunately, this is not new news!
VCP has seen steady progress at Windsor Terrace in Des Moines. We've fully renovated several units and have received supplies for units in the works. Investors received their first distributions in January! As our GP/Sponsor team works hard on the operational side at Windsor Terrace, we are thrilled to be able to distribute projected returns to our investors. It's one of the best parts of what we do as operators.
Despite rising interest rates, the housing market is showing signs of stabilization and multifamily assets' performance continue to remain profitable. Freddie Mac's Multifamily Outlook for 2023 states "...as the economy and market stabilize, the relative strength of the multifamily sector will again become evident, certainly in the middle to longer term. And in the shorter term, indicators suggest that the multifamily market is expected to see healthy growth by the end of 2023." That's great news for multifamily investors! Read the full report HERE