🏗️ Could 'Lego' apartments be the future?

👋 Hello, Best Ever readers!

In this week’s newsletter, the ‘Lego’ apartment arrives, Trump takes aim at Fannie and Freddie, and retail just won’t quit.

Today’s edition is presented by Capital Gains Tax Solutions. Selling a property shouldn't mean losing 20-50% to taxes. Let Capital Gains Tax Solutions create your personalized exit plan and calculate your savings today.

🤔 Still haven’t joined the Best Ever Community? Apply to join here. For serious investors only.

Let’s CRE!

🗞️ NO-FLUFF NEWS
CRE HEADLINES

Dollar Store Deal: Dollar Tree is selling Family Dollar to private equity investors for $1 billion. The sale follows a strategic review and allows Dollar Tree to focus on its core business after struggling with the $9 billion acquisition made in 2015.

New Heights: CRE lenders are still deferring loan repayments, with the $384 billion worth of loans extended into 2025 exceeding the $270 billion extended in 2024. These extensions now represent 40% of all debt maturing this year.

Rumors Swirling: The Trump administration is reportedly exploring the privatization of Fannie Mae and Freddie Mac. The plan could raise $20-30B through an IPO that would value the mortgage giants at over $330B combined, with the government’s stake exceeding $250B.

On the Move: Young Americans (25-44) are increasingly moving to small towns and rural areas, reversing historic migration patterns. Since 2020, two-thirds of population growth in this demographic occurred in areas with fewer than 1 million residents.

Bouncing Back?: Office building sales surged 21% in 2024 as leasing activity outpaced vacancies for the first time since 2019, indicating that the office market may have reached its bottom as remote work wanes, companies seek more space, and demand concentrates on trophy assets.

🏆 TOP STORY
THEY SAVED $800K BY BUILDING ‘LEGO’ APARTMENTS

Investors are getting creative as they attempt to infuse the affordable housing sector with new supply, and one Brooklyn-based developer may have just provided yet another creative blueprint.

Nonprofit developer RiseBoro built Bethany Terraces in Brooklyn’s East Flatbush neighborhood using modular construction coupled with creative pre-packaging and assembly strategies. In a world where construction costs are higher and timelines longer, the four-story, 57-unit complex was completed in just 22 months — a process that traditionally would have taken 30 months.

Here’s the blueprint:

• Giant modular units called "mods" were pre-manufactured in a Pennsylvania factory. Each 60-foot-long unit contained two fully-finished apartments plus the connecting corridor. Trucks delivered nearly four dozen complete units to Brooklyn and staged them near a cemetery in East Flatbush, positioning them for efficient installation.

• Construction crews assembled the building at breakneck speed, stacking up to six units daily during an intensive two-week period. The apartments arrived 100% complete inside, with the only assembly necessary being the setting of appliances, which were delivered strapped inside the corridors, ready to slide into place.

• The team reduced on-site work to only essential connections — welding units together, connecting utilities between apartments and hallways, adding exterior insulation, and completing the roof, eliminating many typical delays that plague traditional building methods.

The building was completed last fall, with the first residents moving in this January. The accelerated timeline translated to significant financial savings — approximately $800,000 in interest payments alone, which averaged around $100,000 monthly. Beyond speed, the project incorporates "passive house" design with ultra-low energy demand, making it well-insulated, airtight, all-electric, and designed to run on solar power.

WHAT IT ALL MEANS

For investors and developers facing high interest rates and material costs (so … everyone), modular construction's predictability, efficiency, and scalability are understandably appealing. But when combined with creative strategies that streamline efficiency and minimize on-site work, it could transform how affordable housing is delivered.

💰 CAPITAL GAINS TAX SOLUTIONS
A BETTER WAY TO SAVE ON CAPITAL GAINS TAXES

Selling a property shouldn't mean losing 20-50% to capital gains taxes. And while most investors think their only option is the outdated, restrictive 1031 exchange, there is a better way.

Capital Gains Tax Solutions has helped countless investors preserve wealth through deferred sales trusts. With over half a billion dollars in closed trusts across real estate, businesses, and even Bitcoin, their results speak for themselves:

• A San Diego business owner selling for $13M kept an extra 40% by deferring taxes

• A dental practice owner selling for $16M saved 30% on taxes

• Multiple clients rescued failing 1031 exchanges with Capital Gains Tax Solutions’ specialized exit plans

Don't settle for outdated strategies. The Deferred Sales Trust advantage gives you flexibility, time, and control while allowing your wealth to compound as you slowly pay taxes over time.

But don’t wait! You must act before closing escrow. So if you have an upcoming sale with at least $1M in proceeds or gains, let Capital Gains Tax Solutions create your personalized exit plan and calculate your savings today.

💰 CRE TRENDS
RETAIL JUST WON’T QUIT

Retail real estate is continuing its strong trajectory into 2025. Vacancy rates remain historically low as expanding retailers quickly absorb available spaces, offsetting expected store closures. Marcus & Millichap recently highlighted retail leasing trends that reinforce the sector’s strength:

• Retail assets leased last year had the fastest turnaround in a decade, averaging just 9.3 months on the market.

• Approximately 25% of spaces were snapped up within three months or less, with food service and fitness brands leading the charge.

• Average lease terms increased to five years, up from the previous decade's 4.4-year average, indicating stronger retailer confidence.

Despite potential economic headwinds on the horizon, the exceptionally light construction pipeline, combined with sustained demand from diverse tenants, should continue to reinforce positive property performance, creating opportunities for both property owners and strategic investors across retail.

🏘️ DEAL OF THE WEEK
A 2.8X EQUITY MULTIPLE AND 181% RETURN IN 5 YEARS

Shane Thomas of Catalyst Equity Partners sold this 142-unit multifamily property with a 2.8X equity multiple and 181% total return in five years.

Here's how he did it 👇

🏢 Property Details: Located in Farmers Branch, TX (Dallas metroplex), this 142-unit Class C asset was purchased in 2018 with 97% occupancy. The property was situated in a strong employment and retail hub near acclaimed schools in a family-friendly area.

💸 Finances: He raised $4.3 million in capital and secured Fannie Mae debt. (Texas is a non-disclosure state, so additional financial details aren't available.)

💼 Business Plan: Over $1 million was invested in CapEx to tackle deferred maintenance, paint, interior renovations, and improved amenities, such as outdoor areas and covered parking. The upgrades allowed him to increase rents by 25%.

🍾 Results: The property was refinanced in year three with a 110% cash out, creating infinite cash-on-cash returns. It sold in 2023 with a 2.81X equity multiple, 181% total return, 39% AAR, and 34% IRR. The final valuation represented a 100%+ increase from the purchase price.

If you have a deal you'd like us to feature, share it with us!

🎓 EXPERT RESOURCES
FREE DOCUMENT DOWNLOAD

Media Tips for Being Interviewed on Podcasts

Being interviewed on real estate podcasts boosts your business by connecting you with new potential investors and partners, building relationships with influential hosts, and showcasing your expertise. To maximize these benefits, here’s a quick guide with strategic media tips to help you present professionally and convert listeners into business opportunities.

Think you have what it takes to be on the Best Ever CRE Show? Fill out this two-minute questionnaire and our team will be in touch.