A. David Lynd leads a vertically integrated commercial real estate firm in San Antonio, Texas that focuses on the multifamily sector. The company has a long-standing history in the acquisition, development, and management of residential and commercial properties. Operating approximately 20,000 apartment units in 13 states, Lynd ranks as one of the premiere multifamily management companies in the country. David Joined Lynd in 1997 where he served as the Chief Operating Officer (COO) for 16 years. In 2018, he was named CEO. Lynd received his Bachelors in Administration from Southern Methodist University and holds a CPM designation from the Institute of Real Estate Management, as well as, the CAPS designation from the National Apartment Association.
The real culprit behind multifamily distress is that rents are flattening or declining in many markets while operating expenses are on the up.
South Florida multifamily investors during boom now feel sting from higher interest rates and insurance premiums.
In their annual Emerging Trends in Real Estate report, the industry groups said the real estate cycle would turn upward in 2025 as interest rates come down.
"The problem is values are down and now rents are starting to decline to go flat," he said. "So they're not keeping pace with the expenses. And then you have interest rates on top of it. So it's a perfect storm. That's just destroying values out there. So if you have a loan coming due anywhere, the value of the asset is just not what it was yesterday."
“We've had a 20-year bull market almost,” Lynd said. “Most of the people in charge of things have never seen a downturn.”
Today's rate cut is a positive step for multifamily, but its impact will be limited. The real threat to our industry's value problem lies in inflation-driven expenses, some of which continue to rise. This means any asset with a maturity issue is facing a value hole that must be addressed. No one is looking at this aspect and these rate adjustments will only provide some recapture of lost value, but it won’t fix the real issue.