Multifamily / Mixed-Use

In 2025, the multifamily sector continued to benefit from elevated interest rates, high for-sale home prices, and tight single-family inventory, which kept many would-be buyers in the rental pool and supported a healthy apartment market.

Approximately 653 units were planned or started in the Cedar Rapids metro during 2025. The average vacancy rate for existing multifamily properties ranged from 3-5% for newer construction and 5-10% in older buildings. Vacancy rates have tightened notably since construction began on the Google and QTS Data Centers, driven by an influx of construction workers. Elevated occupancy is expected to continue for roughly five years.

The average capitalization rate (CAP) rate has decreased slightly to 7.39% in 2025 based on 17 confirmed transactions, compared to 7.51% in 2024 and 7.34% in 2023. The 17 multifamily buildings sold throughout the year included a total of 364 units.

Following several years of heavy construction, the multifamily pipeline is
moderating, as higher financing costs, stricter underwriting, and construction inflation slow the start of new projects. Demand for quality rental housing remains robust, while affordable and workforce housing continue to be priorities.