US multifamily homes, offices find favour among private equity investors

THE multifamily sector in the US is fast catching the attention of private equity investors, including those from Asia, such as South Korea’s Samsung SRA Asset Management.

One of the largest commercial real estate market components in the US, multifamily housing is also one of the most levered, with properties having high loan-to-value ratios. Rising migration and housing costs have boosted the appeal of such dwellings, propelling their valuations to record highs in 2021 and 2022.

Last year, the supply of multifamily homes grew by the most since the 1980s, although “exceptional” demand has helped to absorb that, according to a Jan 8 report by Freddie Mac, the US government agency tasked to support the housing finance system. Despite modest growth in 2024, the agency predicts rents in the sector to rise 2.2 per cent this year, which is 60 basis points below the average between 2000 and 2023.

Park Bumsu, head of global asset management at Samsung SRA Asset Management, told participants at the PERE Asia Summit 2025 earlier this week that it is committing to the multifamily sector in the US this year.

A wholly owned subsidiary of Samsung Life Insurance, the South Korea-based real estate fund manager with about US$20 billion in assets under management (AUM) also expanded into logistics this year. About 60 per cent of its investment portfolio is invested outside South Korea.

Matilde Attolico, senior managing director at Rockpoint, a Boston-based real estate private equity firm with US$14 billion in net AUM, agreed that the multifamily sector is “very attractive”.

“The US remains extremely under-housed, and there seems to be very interesting entry points,” she said at the PERE conference.

More positive outlook for US office sector

Positive job growth prospects and migration trends in the US are boosting the appeal of the country’s residential sector as well, panellists said.

That’s despite mixed sentiments in recent labour market data. On Feb 7, the Bureau of Labor Statistics said that job growth slowed in January, but the unemployment rate edged down to 4 per cent.

Also gaining traction among real estate investors is the office sector in the US, as more companies instruct employees to return to work.

“Office space has been vilified too much, we’re starting to see opportunities out there,” said Matthew Shore, chief investment officer at DRA Advisors, a New York-based property investment adviser that has US$14 billion in committed equity through funds.

On Jan 20, US President Donald Trump signed an executive order mandating federal employees to return to in-person work. Singapore-based brokerage UOB Kay Hian sees the US federal government’s push for return to office work as an impetus for the private sector to follow suit.

It noted that corporate giants such as Amazon, JPMorgan, Boeing and Tesla are demanding that employees work five days a week at the office. More companies are also enforcing minimum office attendance hours. These are boosting the need for more office space to accommodate returning workers.

When asked about investment preferences at the conference, Premraj Janardanan, director of infrastructure investment at Malaysian pension fund KWAP, said: “I think there is some value in the global office sector at this point, even in places like the US.”