7 Benefits of Investing in the Multifamily Commercial Real Estate Market in 2025

With demand for multifamily commercial real estate at its highest since 2021, investors who want to grow their portfolio and earn more passive income cannot overlook this asset class. 

Though economic uncertainty, high interest rates, lower valuations, slower rent growth, and a moderate increase in vacancy rates have plagued this asset class in recent years, it continues to show resilience, providing value to its investors. 

In what follows, we consider the benefits of investing in the multifamily CRE market today and how you can secure the funding you need to benefit from it. 

Key Benefits of Multifamily CRE

1. Steady cash flow 

Multifamily CRE continues to provide steady cash flow to investors via solid long-term rental income. 

As said above, demand is at the highest it has been since 2021. With consistent demand comes regular rental income that investors can count on.  

If you want consistent and dependable cash flow, multifamily is the way to go. 

2. Income stream diversification

Multifamily investors don’t depend on a single income stream. Each unit within the property provides its cash flow. One tenant defaulting or one unit becoming vacant does not spell doom for you as an investor. 

Also, you can choose to invest in a mixed-unit multifamily property (combines residential and commercial uses) to diversify income streams among individuals and businesses. 

3. Demand resilience

High homeownership costs, stable labor markets, and favorable demographics continue to make demand for multifamily properties resilient amidst economic uncertainties. 

Over the years, investors have discovered that multifamily demand remains strong even during inflationary and recessionary periods. Consequently, investors now see them as a potential hedge against inflation and economic downturns. 

Given that the economic uncertainty in the US is still elevated, investing in multifamily CRE can be a good way to safeguard your CRE portfolio. 

4. Potential for capital gains

The high interest rate environment that persisted for so long has led to a decline in the valuations of many CRE properties. Investors who have deployed short-term bridge loans have also had to offload some properties at a discount. 

Given that multifamily fundamentals remain strong, lower property prices provide an opportunity for you to pick up valuable properties at a discount and ride the wave for a higher rate of return. 

Moreover, you can pick up many quality properties without bidding wars as some CRE investors continue to sit the market out. 

5. Economies of scale

Interestingly, managing multiple units within a single property can be more cost-effective than managing many single-family units (especially when they are scattered across various locations). 

The economies of scale associated with multifamily properties can help reduce your commercial property operating expenses and increase your net income. 

6. Attractive funding terms

Financial institutions like commercial banks and government-sponsored enterprises like Fannie Mae and Freddie Mac provide attractive terms (especially lower interest rates) for multifamily projects because they consider them less risky (stable cash flows). 

In difficult fundraising situations (such as we are currently experiencing), focusing on multifamily deals can provide a funding advantage. 

7. Tax benefits

Multifamily investors can take advantage of deductions related to mortgage interest, maintenance expenses, property taxes, and depreciation. 

Tax savings through these opportunities can further increase your rate of return. 

Securing funding for multifamily deals

If you are operating in hot CRE markets, you will still have to compete with other investors for multifamily deals. 

The first stage of the competition is the payment of an earnest money deposit (EMD). In competitive markets, the EMD requirement is often higher and time is of the essence. The investor who can cope with the higher requirements and get the money quickly can gain an advantage. 

With Duckfund, you can gain quick access to EMD financing to secure as many deals as you desire. You can complete the application in two minutes and if successful, funds will be transferred to the escrow within 48 hours. 

Duckfund also provides EMD funding of up to $5 million, making it easier for you to meet the higher requirements of hot CRE markets. 

After paying the EMD, you can also raise equity or debt to finance the multifamily property from Duckfund. The company provides up to $100 million in equity financing and $500 million in debt financing for ground-up development, value-add, and redevelopment projects across the Sunbelt and major US markets. 

With Duckfund, you can take advantage of growing demand in the multifamily market to grow your portfolio and earn more passive income.