Editor’s Insights: The Multifamily Market is Not Frozen—It’s Focused

Headlines often portray the multifamily sector as stalled, with capital markets under pressure and projects in limbo. But in Southern Arizona and beyond, a different reality emerges: the market isn’t frozen. It’s focused.

Courtney Gilstrap Levinus, CEO of the Arizona Multihousing Association, points to new laws unlocking housing potential. Policy reforms are reshaping the landscape, shifting the affordability conversation from obstacles to opportunities. Similarly, Jackson Moll and David Godlewski of the home builders’ associations warn how construction defect lawsuits hinder progress—and how legal reform could revive Arizona’s condo market. These leaders demonstrate that the market is not stalled but is evolving within a framework of accountability and innovation.

Capital, too, is flowing—more selectively than before. Investors and lenders reward projects with strategy, execution, and vision. Those with clear plans and strong fundamentals are still funded—some even earning national recognition.

Evidence across Tucson’s multifamily sector tells the same story: rents have stabilized, operations are improving, and transactions are rebounding. These are not signs of a frozen market, but of recalibration. Local leaders echo this truth: capital chases quality. Builders like Jim Tofel and Drew Lydon with JLL are adapting to higher rates and tighter lending. CBRE’s Jeff Casper and Kevin Prouty and PICOR’s Allan Mendelsberg and Joey Martinez offer insights into investor sentiment and deal flow. Workforce housing is also Northmarq’s Pete O’Neil, emerging as a vital, privately financed alternative to subsidized projects, expanding options at accessible rents.

National research reinforces the trend. Affordability challenges remain, but studies from CBRE, Pew Charitable Trusts, and others show how new construction creates ripple effects of rent relief in older units. Federal tax reform is spurring investment for those positioned strategically.

Most encouraging: the pipeline is active. Over 11,000 units are planned or underway across the Tucson metro, with more than 1,200 delivered in the first half of 2025. The region continues to build and attract capital, even as the industry grows more selective.

The takeaway is clear: multifamily hasn’t paused—it has sharpened its focus. Amid rising costs, rates, and policy uncertainties, the signal remains strong: projects with vision, discipline, and execution will succeed. Tucson and Southern Arizona are not on the sidelines. Real estate’s next chapter will be written not by those chasing yesterday’s momentum, but by those building with intention.

I extend heartfelt thanks to all who share research and perspective for Trend Report, and to our production team — Patti vanLeer, Michael Rossmann, and Jack Paddock—for bringing each issue to life.

This issue also introduces our first Op-Eds, featuring Tucson Ward 3 Council Member Kevin Dahl and business leader Janet Whittenbraker, adding fresh voices to the conversation on growth, housing, and community priorities.

Looking ahead, don’t miss our October issue: Office Trends, with deeper insight into the deals, data, and developments shaping the 2025 office market—plus fresh op-eds!

We welcome your feedback and contributions—visit trendreportaz.com and click “Connect” to get in touch.

Sharpen your edge with actionable insight!