Build-to-Rent: On-site insights
A summary of panel insights shared by speakers at IMN's Build-to-Rent Fall conference, hosted on Sept 28-30 in Dallas, TX.
2026-2027 market recovery
The build-to-rent industry has evolved significantly, growing from early cottage developments to a major institutional asset class attracting substantial capital. Industry leaders are currently positioning for the next market cycle by acquiring existing assets below replacement cost while preparing development pipelines for future opportunities. Operational excellence remains crucial, with companies implementing AI technology, creative leasing strategies, and focusing on active asset management through strong property management partnerships. Access to agency financing has become essential for stabilized communities, offering the most efficient capital structure with competitive rates and assumable loans. Market participants are monitoring supply dynamics closely, noting significant drops in new construction that will create future opportunities. While some markets show recovery signs, the consensus suggests waiting 12-24 months before resuming large-scale development.
There's ongoing debate about optimal unit configurations, with some favoring larger three and four-bedroom units for stability, while others focus on smaller cottage-style units for affordability. The trend toward remote work and multigenerational living is driving demand for flexible spaces and main-floor bedrooms. Companies emphasize the importance of maintaining strict underwriting standards and focusing on premium locations during this transitional period. The industry continues to serve a critical housing need, providing rental options for both those who cannot afford homeownership and those who choose to rent for flexibility.
What about the investment landscape?
The build-to-rent investment landscape has evolved significantly, with operators reporting a shift from preferred equity back to common equity structures and strong appetite from institutional capital, including international investors. Secondary and tertiary markets are outperforming primary metros, with operators focusing on the Carolinas, Midwest cities, and markets with better supply-demand fundamentals rather than oversupplied major metropolitan areas.
Investment strategies have become highly disciplined and selective - operators like Invitation Homes evaluate 250,000 lots annually but win only 1% of opportunities. Deal structures now include creative approaches like 90/10 preferred equity JVs and club deals with $50 million minimums, though some are exploring lower-entry commingled funds. Direct builder partnerships have become crucial channels, with major public builders providing access to merchant-built product even as retail markets recover.
Operators are diversifying beyond traditional acquisition models through platform expansion including third-party property management, construction lending, and programmatic BTR development with 12-36 month pipelines. The consensus indicates sustained long-term growth driven by aging millennial demographics, affordability pressures, and the permanent integration of builder partnerships into the investment ecosystem.
Maximizing ROI via development and construction
The build-to-rent development sector is experiencing a strategic evolution focused on conservative underwriting, sophisticated cost management, and operational optimization. Industry leaders are prioritizing comprehensive pre-construction planning, implementing hybrid contract structures that fairly distribute risk, and adopting density-focused land strategies to maximize returns. While regulatory ESG requirements continue to add costs, developers are finding success through careful product positioning, strategic material hedging, and maintaining organizational cultures that balance deal-making enthusiasm with construction realism. Current market conditions favor projects that can achieve 6.5-7% yields through disciplined approaches to rent growth assumptions, enhanced labor availability, and proven development partnerships that enable repeatable, scalable processes across multiple markets.
Looking ahead...
The build-to-rent industry is positioning for 12-24 month market recovery by acquiring undervalued assets while maintaining strict underwriting standards and focusing on premium locations. Strong institutional capital is favoring secondary markets over oversupplied metros, driving creative deal structures and expanded platform strategies including builder partnerships. Operators emphasize operational excellence through AI implementation and disciplined development targeting 6.5-7% yields to serve growing millennial demand in an affordability-constrained market.
Don't miss out next time - Build-to-Rent Spring takes place on March 16 - 17, 2026 in Nashville TN - Learn more