Our team is currently building over $200 million worth of multifamily real estate as part of your multifamily construction strategy.
And naturally, I’m getting asked one question a lot:
“Ken, how are tariffs and rising rates impacting your builds?”
Here’s what’s really happening—and why this might be the best window we’ve seen in years to buy or build intelligently. This is all part of our broader multifamily construction strategy for 2025 and beyond.
The Supply Shock No One’s Talking About
Let’s start with interest rates.
A couple of years ago, you could borrow at 4% or 5% to build. Today? New construction loans are pushing 9%. That kind of jump doesn’t just affect investors it freezes the entire supply pipeline. Builders pulled back, projects were shelved, and developers hit pause.
This slowdown created a negative supply shock. And when fewer projects break ground, something important shifts behind the scenes: subcontractor pricing power disappears.
In the boom years, plumbers, electricians, HVAC techs everyone could name their price. Not anymore. Today, subcontractors are calling us back, asking for work. And that’s exactly where we want to be as developers.
How Tariffs Fit Into the Equation
Tariffs are definitely in the news again. But in reality, they haven’t impacted us much yet.
Why?
Because most of what we’re building right now is being constructed with existing materials already in the U.S. supply chain. Inventory that was imported long before any new tariffs kicked in.
As a result, we haven’t felt a major cost increase from tariffs on the ground at least not for 2025 or 2026 construction. But we’re watching carefully, because once that older inventory runs out, tariffs could start pushing prices higher by 2027.
That’s why we’re moving now, before those costs hit.
Why We’re Buying in a Down Market
It might seem counterintuitive, but we’re actively buying properties in this market. Why?
Because we’re not afraid of disruption. We look for it.
Right now:
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Homeownership is out of reach for many Americans. High mortgage rates, high insurance premiums, and skyrocketing taxes have made buying a home unaffordable for the average family.
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Multifamily rents are flat. That’s because a wave of new projects (launched during the low-rate era of 2021–2022) are hitting the market, creating lots of choices for renters. Developers are offering concessions just to stay occupied.
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Operating costs are rising. Taxes, insurance, utilities, wages, they’re all up. And that pressure is pushing some property owners to the brink.
All of this sounds bad…unless you’re a buyer.
Because when investors and developers are squeezed, they start to sell. That opens up major opportunities for anyone with a sound multifamily construction strategy and capital ready to deploy.
The Three Multifamily Strategies We’re Using Right Now
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Buying Below Replacement Cost
We’re targeting brand-new developments that started in 2021–2023—projects that are just hitting the market. Many of these properties are still under lease-up, and the developers are struggling to meet their construction loan payments. We’re buying these properties at deep discounts, eliminating the risk of building ourselves. -
Snapping Up Floating-Rate Deals
A lot of people used floating-rate debt during the cheap money era. Today, those interest payments have ballooned, and even well-performing properties are cash flow negative.
We’re acquiring these assets for the cost of their debt or less, and locking in new fixed-rate financing. -
Building Smart at Today’s Prices
We already own land, and we’re negotiating aggressively with subcontractors. Just last week, my partner Ross got every sub to lower their bid by 5%. That flexibility didn’t exist two years ago. Now it does, and we’re using it to build for significantly less.
Looking Ahead to 2027 and 2028
Here’s what we’re anticipating:
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Tariffs may push construction costs higher.
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Fewer new projects will break ground due to high interest rates.
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Renters will face fewer choices as housing supply tightens again.
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Single-family homeownership will remain out of reach for many Americans.
And what does that mean? Scarcity.
Which is exactly what we’re positioning for now.
We’re locking in fixed-rate debt on the properties we buy or build today. That means we know exactly what our cost of capital is, even if rates continue to climb.
The goal is simple: buy when there’s fear, build when there’s room to negotiate, and harvest when the market tightens again. It’s a multifamily construction strategy built on timing, data, and long-term thinking.
Want to See How We’re Doing It?
If you’re an accredited investor, we’re opening up access to our next wave of projects. No pressure, just a look at how we’re underwriting and executing in today’s disrupted environment.
But if you’re not quite ready for that step, or just want to learn more about how we think, here’s something even better:
Want to Learn My Strategy? Get Inside KenPro.
If you’re serious about real estate, this is where it all comes together.
KenPro is my private membership platform where I break down:
✅ Real-world deals we’ve done (with numbers and lessons)
✅ My current acquisition strategies for this economy
✅ Exclusive webinars with industry pros
✅ A private network of other serious investors
✅ Full access to master courses on multifamily, underwriting, syndication, and more
