This is the first quarterly letter from Capistrano Real Estate Partners. Each quarter it records what the partnership is seeing in the five states it studies: North Carolina, South Carolina, Iowa, Kentucky, and Tennessee. It is market commentary. It is not an offer and not a forecast.
The 2016 to 2019 loans are coming due
Ten-year agency loans written between 2016 and 2019 often carried five or seven years of interest-only payments. Those periods have ended. The loans now amortize, and they mature between 2025 and 2029. An owner who planned around interest-only payments now has principal to pay, and a refinance at today's rates may not cover the balance.
- of multifamily CMBS balance maturing in the second half of 2026 would need borrower cash to refinance
- 52%
- would need 20% or more of new equity
- 41%
- of interest-only loans in the sample need a cash-in, against 23% of amortizing loans
- 80%
The Mortgage Bankers Association puts multifamily mortgages maturing in 2026 at about $297 billion, and about $223 billion in 2027. That is two more years in which owners of good properties with hard loans choose between putting in cash, selling, or letting a buyer assume the loan. The partnership is built for the third choice.
New supply is falling in most of the five states
Permits for buildings with five or more units, January to August 2026 against the same months of 2025:
| Metro | Change |
|---|---|
| Louisville | −45% |
| Des Moines | −41% |
| Nashville | −37% |
| Winston-Salem | −28% |
| Charleston | +1% |
| Raleigh–Cary | +8% |
| Charlotte | +14% |
A permit is not a delivery, and one large project can move a small metro's count. The direction matters more than the size. In most of these metros, the pipeline that delivers in two or three years is smaller than the one delivering now. Nashville still had 14,622 units under construction on Yardi Matrix's July count, so the slowdown there is in what comes next, not in what is arriving today. Raleigh–Cary and Charlotte are still permitting more, and a deal there has to be bought with that supply in view.
Suburban rents are holding
Rents in September 2026, with the change from a year earlier:
| City | Rent | Change |
|---|---|---|
| Murfreesboro, Tenn. | $1,408 | +3.8% |
| Charleston, S.C. | $1,708 | +2.9% |
| West Des Moines, Iowa | $1,211 | +2.1% |
| Winston-Salem, N.C. | $1,142 | +1.0% |
| Louisville, Ky. | $1,200 | flat |
| Franklin, Tenn. | $1,781 | −1.2% |
Most of the suburbs the partnership studies are flat to up. That is the pattern it wants to buy into: rents that hold while the next wave of supply gets smaller.
People
Population growth from July 2024 to July 2025: South Carolina 1.5%, the fastest of the five; North Carolina 1.3%; Tennessee 0.9%; Kentucky 0.5%; Iowa 0.2%. Domestic migration was positive in the Carolinas, Tennessee, and Kentucky. Iowa's case rests on supply and suburban demand rather than people moving in.
What the partnership is watching next quarter
- Permits for September through November, to see whether the declines hold.
- Winter rents, which usually soften. The question is whether the suburbs soften less than their metros.
- The 2027 maturities, and how many owners choose an assumption over a cash-in refinance.
The next letter is planned for January 2027, around the time acquisitions are planned to begin.
Sources
- Loan termsFreddie Mac Multifamily K-Deal offering circulars. capitalmarkets.freddiemac.com
- Refinancing pressureTrepp CMBS maturity analysis, as reported by CRE Daily, July 23, 2026. credaily.com
- Maturities by yearMortgage Bankers Association, as reported by BizPac Review, September 24, 2026. bizpacreview.com
- PopulationU.S. Census Bureau, Vintage 2025 population estimates. census.gov
- New supplyU.S. Census Bureau, Building Permits Survey, metro files through August 2026. census.gov
- RentsApartment List city rent reports, October 2026. apartmentlist.com
- Pipeline and occupancyYardi Matrix metro reports, summer 2026. yardimatrix.com
Figures are quoted from the sources above on the dates shown. Permits: U.S. Census Bureau Building Permits Survey, preliminary through August 2026. Rents: Apartment List city reports dated October 2026, measuring September 2026. Population: U.S. Census Bureau Vintage 2025 estimates. Nothing in this letter is an offer to sell or a solicitation of an offer to buy any security.