HomepageArticles by: btinvest

Author: btinvest

Categories2025

Macroeconomics Outlook 2025 Q2

By btinvest,

Macroeconomics Outlook 2025 Q2

We continue to believe US residential rentals, Dallas especially, will be one of the best investment opportunities in the next 3 years. US rental vacancies dropped to 6.8% in the second quarter, a level last seen 26 years ago, with average rental rates hitting another all-time high. All recent reports validate our thesis: The supply of homes available for rent in the US is insufficient to satisfy the surging demand for rental properties. The combination of slow wage growth, low savings, tight mortgage lending standards, and lack of starter homes for sale all contribute to the current shortage. The situation is even more extreme in Dallas, where the vacancy rates in desirable suburbs have dropped below 2%. We expect the current supply and demand imbalance to persist until at least 2018. 

Macroeconomics Outlook

US economy grew 2.3% in the second quarter, rebounding from a lackluster first quarter growth of 0.6%. Unemployment rate dropped down to 5.3%, close to the level of full employment. However, globally, China is slowing down rapidly, Europe and Japan are barely growing, and emerging markets are struggling from the drop in commodity demand and prices.

As the US economy picks up this summer and unemployment rates continue to drop, we expect that the Federal Reserve will attempt to raise the short-term rates this year, for the first time in almost a decade. However, the drop in raw material prices and the strengthening dollar is keeping the Federal Reserve’s measure of inflation below their 2% target, where an increase in short-term rates is warranted Thus, we do not believe the economic conditions will allow the Federal Reserve to raise short-term rates beyond 1% in the next twelve months. Fed Chair Yellen confirms our view in her July 15 testimony to congress, “What matters for financial conditions and the broader economy is the entire expected path of interest rates, not any particular move….Indeed, the stance of monetary policy will likely remain highly accommodative for quite some time after the first increase in the federal funds rate…”

As a result, we still believe mortgage rates will hover around 4% for the remainder of 2015. Accordingly, home prices will increase (though slower in the second half of the year).

Outlook for the Dallas Market

Heavy rain in the spring caused widespread damage and construction delays in Dallas. Luckily, only 2 of our homes suffered any water damage. The construction delay is exacerbating the supply shortage of residential properties.

Employment in Dallas/Fort-Worth metroplex remains robust, feeling no ill effects thus far from the crash in oil prices. We expect the metroplex to produce at least 100,000 net new jobs a year for the next 3 years. The creation of new jobs and associated demand for housing far outnumber the 25,000 new single-family homes being built in 2015. Anecdotally, we spoke to three large apartment operators who are turning away tenants after reaching 105% occupancy – an unusual situation caused by the operators leasing more units than available and then hoping some future tenants fail to show up.

Dallas home values jumped 8.4% in May (year over year), about twice as much as the national average. Unlike the pundits who are calling the Dallas home price surge a bubble, we believe Dallas homes remain extremely undervalued, especially when we factor in the low mortgage rate, low median home price, and the strong job growth in the city. According to the latest Zillow estimate, Dallas median home price is $164,200, still 9% below the national average of $180,100 and less than 3X median income. Compared to other large metros either in the US or abroad, where home prices are typically 5-10X the median income, Dallas homes remain an incredible value.

Foreign investors, especially the Chinese, have taken note of Dallas’ strong economic growth, excellent higher education system, and superior home affordability compared to California and New York. Chinese investors have increased their purchase of Dallas homes by at least 30% this year, now accounting for over 20% of sales to foreigners in the city. As more investors discover Dallas’ great value, we expect Dallas home prices to rise above the national average in the next few years

Our Framework for Selecting Property

We continue to be disciplined in our acquisitions. Our four criteria for selecting property

are 1) desirable location (good schools, safe neighborhood, quiet street); 2) appealing home for the location (size, number of rooms, amenities; 3) gross rental yield of 12% or more; 4) a purchase price significantly below replacement and market value.

We look forward to giving you an update next quarter. In the meantime, please don’t hesitate to contact us should you have any questions, comments or concerns. We always welcome the opportunity to speak with our partners.

IMPORTANT LEGAL NOTICE

This communication and the information contained herein are confidential and proprietary to Bridge Tower Partners, GP, LP (together with its affiliates, “Bridge Tower”, “we”, “our” or “us”) and are being provided to the recipient by Bridge Tower upon the request of the recipient in confidence on the understanding that the recipient will observe and comply with the terms and conditions set forth in this paragraph and the following paragraphs. By accepting this communication, the recipient agrees that the information contained herein is for the exclusive use of the recipient and, without the prior written consent of Bridge Tower, the recipient shall not (i) copy, distribute, make available or otherwise disclose any information in this communication to other parties, or (ii) use such information for any purpose other than the specific purpose of evaluating a potential investment opportunity with Bridge Tower or learning more about Bridge Tower. This communication must be returned to Bridge Tower upon Bridge Tower’s request. Notwithstanding the foregoing, the recipient of this communication may disclose to any and all persons, without limitation of any kind, the tax structure and tax treatment of any investment opportunity with Bridge Tower and all related materials of any kind that are provided to the recipient.

This document and the information contained in this document do not constitute, or form part of, any offer to sell or issue, or any solicitation of an offer to buy or subscribe for, any shares or other securities in any Bridge Tower-sponsored fund or investment vehicle. In deciding whether to invest, prospective investors will be provided with a Confidential Private Placement Memorandum or other offering materials, which include information about risks associated with an investment and the material terms of the relevant fund or investment vehicle’s constituent documents. The recipient acknowledges that this communication does not contain certain material information about Bridge Tower’s investment processes or any specific investment opportunity, including important disclosures and risk factors, which are contained in the definitive investment documentation. The information contained in this communication is subject to all such definitive investment documentation.

The value of investments may fall as well as rise. Any investment with Bridge Tower is suitable only for sophisticated investors and requires the financial ability and willingness to accept for an indefinite period of time the risks and lack of liquidity inherent in the strategy and instruments of such investments.
Certain information (including any statements of opinion and/or belief) contained herein is based on or was obtained or derived from data published or prepared by other parties. While the unaffiliated third-party sources are believed to be reliable, neither Bridge Tower nor any of its directors, officers, employees, partners, shareholders or agents has independently verified such information nor assumes any responsibility for the accuracy of any such information and no such party shall have any liability to any recipient of this communication or any other person relating to or resulting from the use of or reliance on any such information contained herein or any errors therein or omissions therefrom.

No representation, warranty, assurance or undertaking (express or implied) is given (and can therefore not be relied upon as such), and no responsibility or liability is or will be accepted by us or any of our affiliates or our respective officers, employees or agents as to the adequacy, accuracy, completeness or reasonableness of the information, statements and opinions expressed in this document. Any opinions expressed in this document do not constitute legal, tax or investment advice and can therefore not be relied upon as such. The information contained in this document (which does not purport to be comprehensive) is believed to be accurate only on the date hereof and does not imply that the information herein is correct at any time after the date hereof and such information is subject to change at any time without notice. The views expressed herein are subject to change based on market and other conditions and we give no undertaking to update the information, to reflect actual events, circumstances or changes in expectations or to provide additional information after its distribution, even if the information becomes materially inaccurate.

To the extent that this communication includes information about prior investments or activities of Bridge Tower (or its affiliates) or projections of anticipated future performance and other forward-looking statements, such projections and forward-looking statements included herein, or otherwise made orally or in writing from time to time, are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict as well as factors that are beyond Bridge Tower’s control. Past performance is no guarantee of future performance and should not be relied on in deciding whether to invest. Any gross returns presented herein do not reflect the deduction of any management fees, fund expenses, carried interest, or other expenses that may be borne by third-party investors. An individual investor’s actual performance may vary materially based on any number of factors, including the timing of capital contributions and distributions as well as the deduction of all applicable fees and expenses.

The recipient acknowledges and agrees that no person has, nor is held out as having, any authority to give any statement, warranty, representation, assurance or undertaking on our behalf in connection with any potential investment. This communication is intended to be used in one-on-one communications by Bridge Tower, and to be provided by Bridge Tower to single recipients who have the opportunity to discuss its contents with Bridge Tower.

Categories2015

Macroeconomics Outlook 2015 Q1

By btinvest,

Macroeconomics Outlook 2015 Q1

Macroeconomics Outlook

Our three major 2015 predictions for the housing market – 1) mortgage rates will hover around 4%, 2) Fed will be unable to raise short-term rates much, 3) home prices will appreciate at least around 4% – remain on track.

US economy disappointed in the 1Q, with preliminary 1Q GDP growth coming in at just 0.2%. The dismal result pushed projections of a mid-year interest rate increase to the fall. We continue to believe a small 25-50bps interest rate move, if it happens at all this year, will have little to no impact on our business and the US housing market. We strongly doubt the Fed has an appetite for more since the ensuing US dollar strength from a large interest rate move will likely push the US economy into a recession.

Outlook for the Dallas Market

Employment in Dallas/Fort-Worth remains strong from a combination of internal growth and corporate relocations to the region. The metroplex is currently producing around 120,000 net new jobs a year and unemployment hovers around 4%, more or less at full employment. Yet, builders will start construction on only 25,000 single family homes in 2015, just 25% of the number of net new jobs created. The severe shortage of desirable housing has caused homes values to jump 9% in the first quarter (year over year).

Despite the unsustainable surge in the 1Q, Dallas homes remain extremely undervalued, especially when one factors in the low mortgage rate and the moderate median income growth in the city. According to the latest Zillow estimate, Dallas median home price is $157,900, less than 3X median income. Compared to other large metros either in the US or abroad, where home prices are typically 5-10X median income, Dallas is cheap. We continue to be hugely bullish on Dallas housing for the next 3 years.

Our Framework for Selecting Property

We continue to be disciplined in our acquisitions. Our four criteria for selecting property are 1) desirable location (good schools, safe neighborhood, quiet street); 2) appealing home for the location (size, number of rooms, amenities; 3) gross rental yield of 12% or more; 4) a purchase price significantly below replacement and market value.

By only purchasing homes that fit our strict criteria, we expect to achieve a minimum net rental yield of 8%. Combined with our projected 3-6% annual increase in home prices, we can provide investors with good current income and total return of around 12% annually.

IMPORTANT LEGAL NOTICE

This communication and the information contained herein are confidential and proprietary to Bridge Tower Partners, GP, LP (together with its affiliates, “Bridge Tower”, “we”, “our” or “us”) and are being provided to the recipient by Bridge Tower upon the request of the recipient in confidence on the understanding that the recipient will observe and comply with the terms and conditions set forth in this paragraph and the following paragraphs. By accepting this communication, the recipient agrees that the information contained herein is for the exclusive use of the recipient and, without the prior written consent of Bridge Tower, the recipient shall not (i) copy, distribute, make available or otherwise disclose any information in this communication to other parties, or (ii) use such information for any purpose other than the specific purpose of evaluating a potential investment opportunity with Bridge Tower or learning more about Bridge Tower. This communication must be returned to Bridge Tower upon Bridge Tower’s request. Notwithstanding the foregoing, the recipient of this communication may disclose to any and all persons, without limitation of any kind, the tax structure and tax treatment of any investment opportunity with Bridge Tower and all related materials of any kind that are provided to the recipient.

This document and the information contained in this document do not constitute, or form part of, any offer to sell or issue, or any solicitation of an offer to buy or subscribe for, any shares or other securities in any Bridge Tower-sponsored fund or investment vehicle. In deciding whether to invest, prospective investors will be provided with a Confidential Private Placement Memorandum or other offering materials, which include information about risks associated with an investment and the material terms of the relevant fund or investment vehicle’s constituent documents. The recipient acknowledges that this communication does not contain certain material information about Bridge Tower’s investment processes or any specific investment opportunity, including important disclosures and risk factors, which are contained in the definitive investment documentation. The information contained in this communication is subject to all such definitive investment documentation.

The value of investments may fall as well as rise. Any investment with Bridge Tower is suitable only for sophisticated investors and requires the financial ability and willingness to accept for an indefinite period of time the risks and lack of liquidity inherent in the strategy and instruments of such investments.
Certain information (including any statements of opinion and/or belief) contained herein is based on or was obtained or derived from data published or prepared by other parties. While the unaffiliated third-party sources are believed to be reliable, neither Bridge Tower nor any of its directors, officers, employees, partners, shareholders or agents has independently verified such information nor assumes any responsibility for the accuracy of any such information and no such party shall have any liability to any recipient of this communication or any other person relating to or resulting from the use of or reliance on any such information contained herein or any errors therein or omissions therefrom.

No representation, warranty, assurance or undertaking (express or implied) is given (and can therefore not be relied upon as such), and no responsibility or liability is or will be accepted by us or any of our affiliates or our respective officers, employees or agents as to the adequacy, accuracy, completeness or reasonableness of the information, statements and opinions expressed in this document. Any opinions expressed in this document do not constitute legal, tax or investment advice and can therefore not be relied upon as such. The information contained in this document (which does not purport to be comprehensive) is believed to be accurate only on the date hereof and does not imply that the information herein is correct at any time after the date hereof and such information is subject to change at any time without notice. The views expressed herein are subject to change based on market and other conditions and we give no undertaking to update the information, to reflect actual events, circumstances or changes in expectations or to provide additional information after its distribution, even if the information becomes materially inaccurate.

To the extent that this communication includes information about prior investments or activities of Bridge Tower (or its affiliates) or projections of anticipated future performance and other forward-looking statements, such projections and forward-looking statements included herein, or otherwise made orally or in writing from time to time, are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict as well as factors that are beyond Bridge Tower’s control. Past performance is no guarantee of future performance and should not be relied on in deciding whether to invest. Any gross returns presented herein do not reflect the deduction of any management fees, fund expenses, carried interest, or other expenses that may be borne by third-party investors. An individual investor’s actual performance may vary materially based on any number of factors, including the timing of capital contributions and distributions as well as the deduction of all applicable fees and expenses.

The recipient acknowledges and agrees that no person has, nor is held out as having, any authority to give any statement, warranty, representation, assurance or undertaking on our behalf in connection with any potential investment. This communication is intended to be used in one-on-one communications by Bridge Tower, and to be provided by Bridge Tower to single recipients who have the opportunity to discuss its contents with Bridge Tower.

Categories2014

Macroeconomics Outlook 2014 Q4

By btinvest,

Macroeconomics Outlook 2014 Q4

Macroeconomics Outlook

Deflation fears have swept the market after growth slowed globally. Europe is barely growing. Russian economy is imploding from the sanctions. Japan is in recession. China is slowing dramatically. The only bright spot – the US – is plodding along at around 2% growth.

The 60% collapse in oil prices, caused by a combination of increased production from the US Shale Oil and a lack of demand in the global economy, adds to deflationary pressures.

To spur growth and stave off deflation, central banks around the world are doing the only thing they know how – print more money. European Central Bank will start quantitative easing (QE) next month. That has led to the Euro dropping to $1.10 per dollar and falling. In addition, Spanish and Italian bonds are now yielding less than US Treasuries and the German 5-year yields have turned negative! The impending European QE forced the Swiss National Bank to take off its peg to the Euro, causing Swiss Franc to appreciate 20% against the Euro in a single day and pushing Swiss 10-year yields negative. To fight the recession, Japanese central bank is threatening to print money at ever faster speeds, sending Japanese 10-year yield to 0.27%! Canada, India and Singapore have all slashed interest rate and weakened their currencies in the past few weeks to support their economies.

Here are the investment implications for 2015:

1. US long-term rates will stay low. Yield-hungry investors are piling into US Treasuries and mortgage bonds, driving up their prices and lowering their yield. Why would you buy German 10yr yielding at 0.35% when you can buy US 10-year bonds yielding 1.75%? This relative value dynamic has driven down 30yr mortgage rate in the US to around ~3.75%.

2. The Fed will not be able raise rates much in 2015. The Fed wants to raise short-term rates to 1.25% by the end of 2015, but we see very little chance of that happening. US corporate earnings are already hurting from the strong dollar.
Anything beyond a symbolic 0.25% raise will likely cause the dollar to soar and send US growth plummeting below 1%.

3. US home prices will increase in 2015. As the employment picture improves further in the US, the low mortgage rates will lure more buyers back to the market and send US home prices moderately higher. We project home prices in the US to rise about 3-4% in 2015.

Outlook for the Dallas Market

Dallas home values increased around 7% in 2014. Housing inventory remains tight at around 2 months (compared to historical average of 6 months) and demand remains strong from increased employment in the city and surrounding suburbs.

Toyota just moved its North American headquarters from California to Dallas, bringing with it 5,000 jobs to the city. State Farm, the insurance giant, is expanding its presence in Dallas, hiring more than 1,000 workers in the past year. Active Networks and Omnitracs, two technology companies, are also moving to Dallas, bringing 1,500 jobs with them from California. Overall, Dallas added around 110,000 jobs in 2014, pushing the unemployment rate to 4.6%, significantly below the 5.5% rate in the US.

Oil and gas production drives only about 11% of the Texas economy. On the local level, oil and gas related jobs make up less than 5% of total employment in Dallas compared to around 15% or more in Houston. Overall, in Dallas, we expect the small job losses in oil and gas industries will be offset by the jobs created in other industries, leading to moderate job growth and little impact on the real estate market.

With Dallas adding 100,000 jobs annually in the last few years, home builders have only built around 22,000 single family homes per year, far short of the 35,000 homes needed to satisfy demand. In addition, Dallas homes remain extremely undervalued even after the recent surge in price. According to the latest Zillow estimate, Dallas median home price is $152,600, less than 3X median income. Compared to other large metros either in the US or abroad, where home prices are typically 5-10X median income, Dallas is cheap. We project Dallas homes to appreciate another 5-7% in 2015 and remain hugely bullish on Dallas housing for the next 3 years.

Q&A Section: How do we (Bridge Tower) select our properties?

Our Framework for Selecting Property

Our four criteria for selecting property for the Fund are: 

    1. Desirable location (good schools, safe neighborhood, quiet street)
    2. Appealing home for the location (size, number of rooms, amenities
    3. Gross rental yield of 12% or more
    4. A purchase price significantly below replacement and market value

In Dallas, homes that satisfy all 4 criteria typically sell for $180,000 or below and rent for $1,800. Homebuilders, in addition to building less than market demand in the last 4 years, have decided to only build new homes for affluent customers. In 2014, out of the approximately 25,000 new homes built in 2014, less than 4000 homes (~15% total) are priced below $180,000. Since a significant portion of potential homeowners cannot afford these higher priced new homes, they have continued to rent, pushing Dallas vacancies to all-time lows.
By only purchasing homes that fit our strict criteria, the Fund expects to achieve a minimum net rental yield of 8%. Combined with our projected 3-6% annual increase in home prices, the Fund can provide investors with good current income and total return of around 12% annually.

IMPORTANT LEGAL NOTICE

This communication and the information contained herein are confidential and proprietary to Bridge Tower Partners, GP, LP (together with its affiliates, “Bridge Tower”, “we”, “our” or “us”) and are being provided to the recipient by Bridge Tower upon the request of the recipient in confidence on the understanding that the recipient will observe and comply with the terms and conditions set forth in this paragraph and the following paragraphs. By accepting this communication, the recipient agrees that the information contained herein is for the exclusive use of the recipient and, without the prior written consent of Bridge Tower, the recipient shall not (i) copy, distribute, make available or otherwise disclose any information in this communication to other parties, or (ii) use such information for any purpose other than the specific purpose of evaluating a potential investment opportunity with Bridge Tower or learning more about Bridge Tower. This communication must be returned to Bridge Tower upon Bridge Tower’s request. Notwithstanding the foregoing, the recipient of this communication may disclose to any and all persons, without limitation of any kind, the tax structure and tax treatment of any investment opportunity with Bridge Tower and all related materials of any kind that are provided to the recipient.

This document and the information contained in this document do not constitute, or form part of, any offer to sell or issue, or any solicitation of an offer to buy or subscribe for, any shares or other securities in any Bridge Tower-sponsored fund or investment vehicle. In deciding whether to invest, prospective investors will be provided with a Confidential Private Placement Memorandum or other offering materials, which include information about risks associated with an investment and the material terms of the relevant fund or investment vehicle’s constituent documents. The recipient acknowledges that this communication does not contain certain material information about Bridge Tower’s investment processes or any specific investment opportunity, including important disclosures and risk factors, which are contained in the definitive investment documentation. The information contained in this communication is subject to all such definitive investment documentation.

The value of investments may fall as well as rise. Any investment with Bridge Tower is suitable only for sophisticated investors and requires the financial ability and willingness to accept for an indefinite period of time the risks and lack of liquidity inherent in the strategy and instruments of such investments.
Certain information (including any statements of opinion and/or belief) contained herein is based on or was obtained or derived from data published or prepared by other parties. While the unaffiliated third-party sources are believed to be reliable, neither Bridge Tower nor any of its directors, officers, employees, partners, shareholders or agents has independently verified such information nor assumes any responsibility for the accuracy of any such information and no such party shall have any liability to any recipient of this communication or any other person relating to or resulting from the use of or reliance on any such information contained herein or any errors therein or omissions therefrom.

No representation, warranty, assurance or undertaking (express or implied) is given (and can therefore not be relied upon as such), and no responsibility or liability is or will be accepted by us or any of our affiliates or our respective officers, employees or agents as to the adequacy, accuracy, completeness or reasonableness of the information, statements and opinions expressed in this document. Any opinions expressed in this document do not constitute legal, tax or investment advice and can therefore not be relied upon as such. The information contained in this document (which does not purport to be comprehensive) is believed to be accurate only on the date hereof and does not imply that the information herein is correct at any time after the date hereof and such information is subject to change at any time without notice. The views expressed herein are subject to change based on market and other conditions and we give no undertaking to update the information, to reflect actual events, circumstances or changes in expectations or to provide additional information after its distribution, even if the information becomes materially inaccurate.

To the extent that this communication includes information about prior investments or activities of Bridge Tower (or its affiliates) or projections of anticipated future performance and other forward-looking statements, such projections and forward-looking statements included herein, or otherwise made orally or in writing from time to time, are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict as well as factors that are beyond Bridge Tower’s control. Past performance is no guarantee of future performance and should not be relied on in deciding whether to invest. Any gross returns presented herein do not reflect the deduction of any management fees, fund expenses, carried interest, or other expenses that may be borne by third-party investors. An individual investor’s actual performance may vary materially based on any number of factors, including the timing of capital contributions and distributions as well as the deduction of all applicable fees and expenses.

The recipient acknowledges and agrees that no person has, nor is held out as having, any authority to give any statement, warranty, representation, assurance or undertaking on our behalf in connection with any potential investment. This communication is intended to be used in one-on-one communications by Bridge Tower, and to be provided by Bridge Tower to single recipients who have the opportunity to discuss its contents with Bridge Tower.

Categories2025

Fresh Meadows Amenity Center Grand Opening

By btinvest,

Amenity Center Grand Opening

Download PDF

July 16, 2025

Bridge Tower Milestone in Temple, TX

58 Acres | 256 Homes | 2 Phases

Bridge Tower is pleased to announce the upcoming grand opening of the amenity center at Fresh Meadows, marking a key milestone in the delivery of our 256-home Build-to-Rent (BTR) community in Temple, TX. Opening July 31, the new amenity hub reflects our commitment to thoughtful, resident-focused design, featuring:

  • 3,600-square-foot clubhouse
  • Resort-style pool
  • State-of-the-art fitness center
  • Leasing offices
  • Indoor/outdoor yoga space 
  • Grilling stations
  • Community room with covered patio

Strategically located within the high-growth Austin MSA, Fresh Meadows spans 58 acres and offers a mix of single-story and two-story detached homes, anchored by a thoughtfully designed amenity center. The Bridge Tower team designed the community to accommodate a diverse resident base—from young families to active adults—by supporting a wide range of lifestyle needs, including wellness, recreation, connection, and relaxation. The development is being delivered in two efficient phases: Phase I (70 homes) was completed on schedule in September 2024, and Phase II (186 homes) remains on track for completion by year-end 2025. From entitlement through horizontal and vertical construction, BT’s work at Fresh Meadows demonstrates our ability to scale through strategic planning and disciplined execution.

Texas continues to be a cornerstone of Bridge Tower’s BTR and Single-Family Rental (SFR) strategy and Fresh Meadows is a prime example of our ability to execute high-quality, community-scale rental housing in dynamic markets. With active developments and property management operations in Dallas, Houston, Austin, and San Antonio, we have established a strong, statewide presence. Backed by our capacity to deliver 500+ homes annually, we are well-positioned to scale our platform—and we look forward to sharing future milestones as we expand our portfolio of high-quality BTR communities across key growth markets.

IMPORTANT LEGAL NOTICE

This communication and the information contained herein are confidential and proprietary to Bridge Tower Partners, GP, LP (together with its affiliates, “Bridge Tower”, “we”, “our” or “us”) and are being provided to the recipient by Bridge Tower upon the request of the recipient in confidence on the understanding that the recipient will observe and comply with the terms and conditions set forth in this paragraph and the following paragraphs. By accepting this communication, the recipient agrees that the information contained herein is for the exclusive use of the recipient and, without the prior written consent of Bridge Tower, the recipient shall not (i) copy, distribute, make available or otherwise disclose any information in this communication to other parties, or (ii) use such information for any purpose other than the specific purpose of evaluating a potential investment opportunity with Bridge Tower or learning more about Bridge Tower. This communication must be returned to Bridge Tower upon Bridge Tower’s request. Notwithstanding the foregoing, the recipient of this communication may disclose to any and all persons, without limitation of any kind, the tax structure and tax treatment of any investment opportunity with Bridge Tower and all related materials of any kind that are provided to the recipient.

This document and the information contained in this document do not constitute, or form part of, any offer to sell or issue, or any solicitation of an offer to buy or subscribe for, any shares or other securities in any Bridge Tower-sponsored fund or investment vehicle. In deciding whether to invest, prospective investors will be provided with a Confidential Private Placement Memorandum or other offering materials, which include information about risks associated with an investment and the material terms of the relevant fund or investment vehicle’s constituent documents. The recipient acknowledges that this communication does not contain certain material information about Bridge Tower’s investment processes or any specific investment opportunity, including important disclosures and risk factors, which are contained in the definitive investment documentation. The information contained in this communication is subject to all such definitive investment documentation.

The value of investments may fall as well as rise. Any investment with Bridge Tower is suitable only for sophisticated investors and requires the financial ability and willingness to accept for an indefinite period of time the risks and lack of liquidity inherent in the strategy and instruments of such investments.
Certain information (including any statements of opinion and/or belief) contained herein is based on or was obtained or derived from data published or prepared by other parties. While the unaffiliated third-party sources are believed to be reliable, neither Bridge Tower nor any of its directors, officers, employees, partners, shareholders or agents has independently verified such information nor assumes any responsibility for the accuracy of any such information and no such party shall have any liability to any recipient of this communication or any other person relating to or resulting from the use of or reliance on any such information contained herein or any errors therein or omissions therefrom.

No representation, warranty, assurance or undertaking (express or implied) is given (and can therefore not be relied upon as such), and no responsibility or liability is or will be accepted by us or any of our affiliates or our respective officers, employees or agents as to the adequacy, accuracy, completeness or reasonableness of the information, statements and opinions expressed in this document. Any opinions expressed in this document do not constitute legal, tax or investment advice and can therefore not be relied upon as such. The information contained in this document (which does not purport to be comprehensive) is believed to be accurate only on the date hereof and does not imply that the information herein is correct at any time after the date hereof and such information is subject to change at any time without notice. The views expressed herein are subject to change based on market and other conditions and we give no undertaking to update the information, to reflect actual events, circumstances or changes in expectations or to provide additional information after its distribution, even if the information becomes materially inaccurate.

To the extent that this communication includes information about prior investments or activities of Bridge Tower (or its affiliates) or projections of anticipated future performance and other forward-looking statements, such projections and forward-looking statements included herein, or otherwise made orally or in writing from time to time, are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict as well as factors that are beyond Bridge Tower’s control. Past performance is no guarantee of future performance and should not be relied on in deciding whether to invest. Any gross returns presented herein do not reflect the deduction of any management fees, fund expenses, carried interest, or other expenses that may be borne by third-party investors. An individual investor’s actual performance may vary materially based on any number of factors, including the timing of capital contributions and distributions as well as the deduction of all applicable fees and expenses.

The recipient acknowledges and agrees that no person has, nor is held out as having, any authority to give any statement, warranty, representation, assurance or undertaking on our behalf in connection with any potential investment. This communication is intended to be used in one-on-one communications by Bridge Tower, and to be provided by Bridge Tower to single recipients who have the opportunity to discuss its contents with Bridge Tower.

Categories2025

Investor Update July 2025

By btinvest,

Investor Update July 2025

July 15, 2025

Why Real Assets Work-Even When Markets Don't

In This Edition:

  • Investor FAQ: Why Are Real Assets the Future of Investing?
  • Our Decision to Go With SFR: A Post-2008 Origin Story
  • Market Pulse: Ownership Gap Continues to Drive SFR Demand

Investor FAQ with George Huang, PhD, Managing Partner at Bridge Tower

Q: Why are real assets the future of investing?

A: To unlock income that’s steady, resilient, and built to weather economic storms.

Real assets—like rental housing, infrastructure, and healthcare facilities—aren’t just physical investments; they’re powerful financial tools. They generate reliable cash flow, protect against inflation, and reduce exposure to stock market volatility. Historically, they’ve also delivered strong performance relative to assets with similar risk profiles.

Today’s shifting demographics and economic trends are fueling unprecedented demand for these tangible assets—especially in high-growth, high-need sectors like Build-to-Rent housing in affordable Sunbelt suburbs. It’s one of the most compelling opportunities for investors seeking long-term value in essential, income-generating real estate.

Have a question about the housing market? Email us at [email protected]—your question may be featured anonymously in a future edition!

Submit Your Question Today!

Real Assets, Real Returns. Are you in?

Align with experience and invest alongside us

BT Select Fund VI, a new investment vehicle focused on delivering risk-adjusted returns through purpose-built, professionally managed rental communities.

Prefer a direct investment? Limited spots available for Park Hollow, a BTR project in Richardson, TX.
Learn More

The BT Story: Why we Chose Single-Family Rentals (SFR)

We launched our SFR investment strategy in the aftermath of the 2008 financial crisis, when we saw a compelling alignment of factors:

  • Homes trading below replacement costs
  • A shift from ownership to renting
  • SFRs deliver consistent and stable returns
Those early decisions paid off. Our initial investors looked past the uncertainty, committed with conviction, and were rewarded with double-digit cash yields and strong total returns.

Along the way, we also learned that real assets truly withstand the test of time. And with fundamentals like strong demand, stable cash flow, asset price appreciation, and institutional scalability, we haven’t waivered from our commitment to growing with the sector.
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A Demand Story Still Unfolding: What It Means for SFR Investors

As interest rates remain high and housing options remain limited, many Americans have turned to SFR. We expect continued demand in both the near term and as demand drivers continue to compound over time. Fueling demand are two key factors:

  • Homeownership costs now far outpace the cost of renting
  • Lower mortgage rates won’t close the gap unless accompanied by substantial rent growth
As renting becomes not only more accessible, but also the more economically rational option, professionally managed single-family rentals are poised to capture a growing share of U.S. households seeking affordability, flexibility, and quality housing. Bridge Tower is in a unique position to capitalize on this growing demand! BT’s fully integrated platform and specialized focus on single-family rental (SFR) investments is a performance advantage in today’s market.
INVESTOR IQ

INVESTOR IQ

Did you know SFR (Single-Family Rental) typically refers to existing homes rented out individually, while BTR (Build-to-Rent) communities are purpose-built, professionally managed neighborhoods designed from the ground up for rental living—offering scalability, consistency, and institutional-grade operations.

At Bridge Tower, we’re seasoned experts in both SFR and BTR product, leveraging over a decade of experience in U.S. residential real estate!

IMPORTANT LEGAL NOTICE

This communication and the information contained herein are confidential and proprietary to Bridge Tower Partners, GP, LP (together with its affiliates, “Bridge Tower”, “we”, “our” or “us”) and are being provided to the recipient by Bridge Tower upon the request of the recipient in confidence on the understanding that the recipient will observe and comply with the terms and conditions set forth in this paragraph and the following paragraphs. By accepting this communication, the recipient agrees that the information contained herein is for the exclusive use of the recipient and, without the prior written consent of Bridge Tower, the recipient shall not (i) copy, distribute, make available or otherwise disclose any information in this communication to other parties, or (ii) use such information for any purpose other than the specific purpose of evaluating a potential investment opportunity with Bridge Tower or learning more about Bridge Tower. This communication must be returned to Bridge Tower upon Bridge Tower’s request. Notwithstanding the foregoing, the recipient of this communication may disclose to any and all persons, without limitation of any kind, the tax structure and tax treatment of any investment opportunity with Bridge Tower and all related materials of any kind that are provided to the recipient.

This document and the information contained in this document do not constitute, or form part of, any offer to sell or issue, or any solicitation of an offer to buy or subscribe for, any shares or other securities in any Bridge Tower-sponsored fund or investment vehicle. In deciding whether to invest, prospective investors will be provided with a Confidential Private Placement Memorandum or other offering materials, which include information about risks associated with an investment and the material terms of the relevant fund or investment vehicle’s constituent documents. The recipient acknowledges that this communication does not contain certain material information about Bridge Tower’s investment processes or any specific investment opportunity, including important disclosures and risk factors, which are contained in the definitive investment documentation. The information contained in this communication is subject to all such definitive investment documentation.

The value of investments may fall as well as rise. Any investment with Bridge Tower is suitable only for sophisticated investors and requires the financial ability and willingness to accept for an indefinite period of time the risks and lack of liquidity inherent in the strategy and instruments of such investments.
Certain information (including any statements of opinion and/or belief) contained herein is based on or was obtained or derived from data published or prepared by other parties. While the unaffiliated third-party sources are believed to be reliable, neither Bridge Tower nor any of its directors, officers, employees, partners, shareholders or agents has independently verified such information nor assumes any responsibility for the accuracy of any such information and no such party shall have any liability to any recipient of this communication or any other person relating to or resulting from the use of or reliance on any such information contained herein or any errors therein or omissions therefrom.

No representation, warranty, assurance or undertaking (express or implied) is given (and can therefore not be relied upon as such), and no responsibility or liability is or will be accepted by us or any of our affiliates or our respective officers, employees or agents as to the adequacy, accuracy, completeness or reasonableness of the information, statements and opinions expressed in this document. Any opinions expressed in this document do not constitute legal, tax or investment advice and can therefore not be relied upon as such. The information contained in this document (which does not purport to be comprehensive) is believed to be accurate only on the date hereof and does not imply that the information herein is correct at any time after the date hereof and such information is subject to change at any time without notice. The views expressed herein are subject to change based on market and other conditions and we give no undertaking to update the information, to reflect actual events, circumstances or changes in expectations or to provide additional information after its distribution, even if the information becomes materially inaccurate.

To the extent that this communication includes information about prior investments or activities of Bridge Tower (or its affiliates) or projections of anticipated future performance and other forward-looking statements, such projections and forward-looking statements included herein, or otherwise made orally or in writing from time to time, are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict as well as factors that are beyond Bridge Tower’s control. Past performance is no guarantee of future performance and should not be relied on in deciding whether to invest. Any gross returns presented herein do not reflect the deduction of any management fees, fund expenses, carried interest, or other expenses that may be borne by third-party investors. An individual investor’s actual performance may vary materially based on any number of factors, including the timing of capital contributions and distributions as well as the deduction of all applicable fees and expenses.

The recipient acknowledges and agrees that no person has, nor is held out as having, any authority to give any statement, warranty, representation, assurance or undertaking on our behalf in connection with any potential investment. This communication is intended to be used in one-on-one communications by Bridge Tower, and to be provided by Bridge Tower to single recipients who have the opportunity to discuss its contents with Bridge Tower.

Categories2025

Investor Update June 2025

By btinvest,

Investor Update June 2025

Download PDF

June 18, 2025

MACROECONOMIC CROSSCURRENTS

The early months of 2025 have seen sharp macroeconomic shifts. The ECB cut rates to 2.25% amid growing economic weakness, while the U.S. Federal Reserve has held firm despite clear signs of a slowdown. Chairman Powell’s reluctance to ease has been seen as reactive, raising the likelihood of more frequent rate cuts later in the year.

Our projection of four rate cuts in 2025—once aggressive—is now in line with broader market consensus. Meanwhile, long-end Treasury yields have risen due to broad deleveraging by hedge funds and banks, prompting speculation that the Fed may reintroduce QE under the guise of yield curve stabilization. This could drive the U.S. dollar lower.

Despite ongoing de-dollarization narratives, we view these concerns as overblown; no credible alternative reserve currency currently exists. For example, meaningful yuan adoption would require China to open its capital account—an unlikely and risky move.

Against this backdrop, we now assign a greater than 60% probability to a U.S. recession within 12 months, absent a resolution to trade tensions. If a recession hits in the second half, we expect unemployment to rise modestly (2–3 pts) followed by a Fed pivot. Historically, such conditions—falling rates, weaker dollar, and lower treasury yields—have created attractive long-term entry points for residential real estate investors.

With diverging central bank policies and rising geopolitical tensions reshaping market expectations, often more quickly than policymakers can adapt, headwinds and select opportunities are appearing for disciplined capital allocators. Since inception, Bridge Tower has remained committed to staying calm, focused, and operationally efficient—regardless of broader market conditions. Dislocations continue to create opportunities, and we approach them with long-term conviction and disciplined execution.

HOUSING & CAPITAL MARKETS

With over 80% of U.S. mortgages locked in below 6%, resale supply remains constrained despite softening prices. This “lock- in effect” continues to boost demand for build-to-rent (BTR) and single-family rental (SFR) properties. Meanwhile, a weaker dollar—down ~10% year-over-year—has revived foreign investor interest, especially from Asia, as buyers take advantage of improved FX conditions to target stabilized, cash-flowing assets in Sunbelt markets.

BTR remains resilient even in a downturn, benefiting from a stable, suburban tenant base and lower turnover. Historical performance, including steady SFR rents during the 2008 crisis, reinforces its value as a defensive play within residential real estate.

Highlights

“Those with vision, resources, and conviction are best equipped to seize meaningful upside and long-term opportunity—and we look forward to continuing to grow our footprint in the BTR space.”

– Dr. George Huang, Ph.D., CFA | Managing Partner

INVESTOR OUTLOOK
Our forward-looking strategy is positioned to capitalize on long-term housing demand

MARKET TRENDS
Despite tighter capital markets, demand for single-family rentals remains strong in growth corridors

________

We’re excited to share a new
opportunity to invest
alongside us through BT
Select Fund VI, created to
meet the ever-growing
institutional demand for
BTR housing.

Preferred Shares, targeting
a 10% annual return with no
profit-sharing for stable,
fixed-income-like exposure.

Common Shares, which
provide a 7% annual
dividend plus a 70/30 profit
split for those seeking both
income and upside
potential.

BUILDING & OPERATING THROUGH VOLATILITY

As population growth and household formation continue, institutional investors increasingly view BTR as a scalable, family- friendly alternative to traditional multifamily. Unlike apartments, which can be over-amenitized and lack functionality, BTR communities offer the space, privacy, and livability today’s renters are seeking. This shift reinforces our conviction in the enduring value of well-designed Bridge Tower BTR assets.

Due to our ongoing optimism about the U.S. real estate market and confidence in the long-term potential of build-to-rent (BTR), we’re excited to share a new opportunity to invest alongside us through BT Select Fund VI, created to meet the ever-growing institutional demand for BTR housing. The fund is structured as a diversified vehicle, deploying capital across multiple BTR projects in Texas and other high-growth markets. This approach offers exposure to a broader portfolio while helping mitigate single-asset risk and capture long-term upside in the sector.

To accommodate varying investor goals, we offer two share classes: Preferred Shares, targeting a 10% annual return with no profit-sharing for stable, fixed-income-like exposure, and Common Shares, which provide a 7% annual dividend plus a 70/30 profit split for those seeking both income and upside potential. Those with vision, resources, and conviction are best equipped to seize meaningful upside and long-term opportunity and we look forward to continuing to grow our footprint in the BTR space.

Stay Connected

If you’re interested in making another investment with Bridge Tower or know of another accredited investor who would like to learn more about these opportunities, please reach out to us at [email protected]

ESCALATING TARIFFS IMPACT ON US ECONOMY & THE HOUSING SECTOR

Following rapid policy shifts, U.S. tariffs have risen to an effective rate of 10–15%, a sharp jump from the prior 2%, though still below the initially projected 25% on “Liberation Day”.

Tariffs policy has become a key driver of market uncertainty. If fully passed to consumers, it could raise CPI by 1–2%, temporarily eroding real wages and softening demand. As a result, businesses will slow investment and consumers will pull back spending through the remainder of 2025, absent a resolution of the trade war.

Looking ahead, the impact on residential housing is twofold: lower mortgage rates—potentially dropping below 5% by early 2026—are expected to revive demand, especially in underserved segments, while recession-driven rate cuts typically boost institutional interest in housing as a defensive asset. Combined with ongoing supply-demand imbalances, these trends continue to support our BTR strategy.

• Higher Construction Costs: Tariffs are projected to add ~$10,000 per home, compressing builder margins amid already tight affordability—challenging, but manageable.

• Better Cost Control: Slower construction starts have improved our negotiating leverage with subcontractors and suppliers, helping offset some of the cost pressures.

• Pragmatic Positioning: While we oppose protectionism, our focus remains on likely outcomes and financial impacts, with disciplined cost management guiding our response.

Metric (12-mo. view)

Bridge Tower Base-Case

Rationale

30-yr fixed mortgage rate

Peaks near 7% mid-year, glides to ~6% by Q4

Fed easing + possible QE

National home-price index

0 – 3% move

Tight inventory offsets weaker demand

SFR/BTR rent growth

+2 – 4%

Household formation slows, but rental demand remains steady amid high ownership costs

SFR/BTR sector health

Outperform

Sector fundamentals poised to strengthen in 2026/2027

IMPORTANT LEGAL NOTICE

This communication and the information contained herein are confidential and proprietary to Bridge Tower Partners, GP, LP (together with its affiliates, “Bridge Tower”, “we”, “our” or “us”) and are being provided to the recipient by Bridge Tower upon the request of the recipient in confidence on the understanding that the recipient will observe and comply with the terms and conditions set forth in this paragraph and the following paragraphs. By accepting this communication, the recipient agrees that the information contained herein is for the exclusive use of the recipient and, without the prior written consent of Bridge Tower, the recipient shall not (i) copy, distribute, make available or otherwise disclose any information in this communication to other parties, or (ii) use such information for any purpose other than the specific purpose of evaluating a potential investment opportunity with Bridge Tower or learning more about Bridge Tower. This communication must be returned to Bridge Tower upon Bridge Tower’s request. Notwithstanding the foregoing, the recipient of this communication may disclose to any and all persons, without limitation of any kind, the tax structure and tax treatment of any investment opportunity with Bridge Tower and all related materials of any kind that are provided to the recipient.

This document and the information contained in this document do not constitute, or form part of, any offer to sell or issue, or any solicitation of an offer to buy or subscribe for, any shares or other securities in any Bridge Tower-sponsored fund or investment vehicle. In deciding whether to invest, prospective investors will be provided with a Confidential Private Placement Memorandum or other offering materials, which include information about risks associated with an investment and the material terms of the relevant fund or investment vehicle’s constituent documents. The recipient acknowledges that this communication does not contain certain material information about Bridge Tower’s investment processes or any specific investment opportunity, including important disclosures and risk factors, which are contained in the definitive investment documentation. The information contained in this communication is subject to all such definitive investment documentation.

The value of investments may fall as well as rise. Any investment with Bridge Tower is suitable only for sophisticated investors and requires the financial ability and willingness to accept for an indefinite period of time the risks and lack of liquidity inherent in the strategy and instruments of such investments.
Certain information (including any statements of opinion and/or belief) contained herein is based on or was obtained or derived from data published or prepared by other parties. While the unaffiliated third-party sources are believed to be reliable, neither Bridge Tower nor any of its directors, officers, employees, partners, shareholders or agents has independently verified such information nor assumes any responsibility for the accuracy of any such information and no such party shall have any liability to any recipient of this communication or any other person relating to or resulting from the use of or reliance on any such information contained herein or any errors therein or omissions therefrom.

No representation, warranty, assurance or undertaking (express or implied) is given (and can therefore not be relied upon as such), and no responsibility or liability is or will be accepted by us or any of our affiliates or our respective officers, employees or agents as to the adequacy, accuracy, completeness or reasonableness of the information, statements and opinions expressed in this document. Any opinions expressed in this document do not constitute legal, tax or investment advice and can therefore not be relied upon as such. The information contained in this document (which does not purport to be comprehensive) is believed to be accurate only on the date hereof and does not imply that the information herein is correct at any time after the date hereof and such information is subject to change at any time without notice. The views expressed herein are subject to change based on market and other conditions and we give no undertaking to update the information, to reflect actual events, circumstances or changes in expectations or to provide additional information after its distribution, even if the information becomes materially inaccurate.

To the extent that this communication includes information about prior investments or activities of Bridge Tower (or its affiliates) or projections of anticipated future performance and other forward-looking statements, such projections and forward-looking statements included herein, or otherwise made orally or in writing from time to time, are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict as well as factors that are beyond Bridge Tower’s control. Past performance is no guarantee of future performance and should not be relied on in deciding whether to invest. Any gross returns presented herein do not reflect the deduction of any management fees, fund expenses, carried interest, or other expenses that may be borne by third-party investors. An individual investor’s actual performance may vary materially based on any number of factors, including the timing of capital contributions and distributions as well as the deduction of all applicable fees and expenses.

The recipient acknowledges and agrees that no person has, nor is held out as having, any authority to give any statement, warranty, representation, assurance or undertaking on our behalf in connection with any potential investment. This communication is intended to be used in one-on-one communications by Bridge Tower, and to be provided by Bridge Tower to single recipients who have the opportunity to discuss its contents with Bridge Tower.