Key facts
- Neology Group secured $175 million in capital for multifamily development.
- The funding will support projects in Florida and the Southeast.
- The capital allows Neology to pursue approximately $1 billion in deals.
- The national apartment construction pipeline is at its lowest share since 2013.
- Renter demand is outpacing the delivery of new units.
Miami-based multifamily developer Neology Group has successfully raised $175 million in new capital, positioning itself to capitalize on a shrinking national construction pipeline and increasing renter demand. The funding allows the company to pursue approximately $1 billion in new deals.
Lissette Calderon, Neology's founder, stated that the capital comes from a mix of long-term family office and private investors, as well as new institutional investors. This infusion of private equity signals a return of capital to apartment developers after investment slowed in 2022 due to rising interest rates and construction costs.
Nationally, the apartment construction pipeline has contracted significantly, representing its lowest share of existing stock since 2013. This scarcity, coupled with resilient renter demand that now outpaces new unit deliveries, creates an opportune environment for developers.
Neology, which has a history of developing over 2,000 condos and 5 million square feet of residential space in Florida, primarily Miami, plans to maintain its focus on the state while also exploring opportunities across the Southeast. The company is also expanding into larger, district-scale projects that integrate housing with retail, hospitality, and cultural spaces, including a recent partnership on a three-phase project in Miami's Rubell Arts District.
The company's strategic timing aligns with broader market trends, including a strong leasing quarter reported by Cushman & Wakefield, where renters absorbed more units than were delivered for the first time since early 2022. Elevated interest rates and costs have pushed many developers to the sidelines, leading to a sharp slowdown in new construction, with only 3.5% of existing apartment stock currently under construction nationally.
While Florida experienced significant construction and rent growth during the pandemic, the market has cooled, particularly for higher-end properties. The national and Florida construction pipelines are thinning. Predictions for the timing of the next construction cycle vary, with some pointing to late this year and others to 2028. The National Association of Home Builders anticipates further declines in construction, nearing pre-pandemic levels.