Quick Take: The multifamily market is showing signs of recovery in 2025, supported by strong absorption, demographic demand and limited housing supply. The IncomePlus Fund has consistently outperformed competitors. It has delivered positive returns in 71 of 76 months and increased its distribution yield by 20% over three years. Structured as a REIT, the fund provides tax efficiency through qualified dividend deductions while simplifying investor tax reporting with a single 1099. Its flexible strategy—balancing acquisitions, development and financing—has allowed it to manage risk and capture opportunities across cycles. This has positioned the portfolio for growth as fundamentals improve.
The multifamily real estate market is showing clear signs of recovery as 2025 progresses. Fundamentals are improving across our target markets, and apartment absorption rates are on pace to exceed last year’s levels. Multifamily is benefiting from both demographic tailwinds and a persistent housing shortage.
Against this backdrop, the IncomePlus Fund delivered for investors even through the past few years of extraordinary volatility. As of June 30, 2025, the fund outperformed the average returns of some of the largest private real estate fund competitors and the public, multifamily-focused REIT sector in trailing one-, three- and five-year returns—by 641%, 794% and 417%, respectively. Since inception, the fund has produced positive returns in 71 out of 76 months, with 100% of monthly distributions met and a 20% increase in distribution yield over the past three years.
1) As of 6/30/2025. Returns are for the INV share class. Actual individual investor performance may differ based on share class. Total returns reflected are net of fund fees and assume monthly reinvestment of distributions. Non-traded REITS reflect eight of the industry’s largest non-traded REITs that provide publicly available performance reporting. Origin has not separately verified accuracy of the performance data with each third-party issuer. Returns are not guaranteed. Past performance is no guarantee of future results. All investments involve a degree of risk, including the risk of loss.
Fund Returns
The fund’s objective is to generate a 9% to 11% annualized return. That includes the distribution yield, which stood at 6.45% as of June 30, 2025. After tax, the fund is generating a 6.32% distribution yield. That’s the equivalent of more than 10% on another investment whose distribution is being taxed at the highest federal income tax rate (if an investor pays state income taxes, they would have to earn even more). We have increased the distribution yield by 20% over the past three years, and our goal is to increase it every year.
Depreciation of the fund’s properties lowers its taxable income without reducing the cash available for distribution. Distributions in excess of the fund’s taxable income are generally treated as a non-taxable return of capital. In 2024, 98% of the IncomePlus Fund’s distributions were treated as a non-taxable return of capital.
The Benefits of a REIT Structure
The fund is structured as a REIT, which has two major benefits. The first is that investors take a deduction equal to 20% of qualified dividends, so those qualified dividends will be taxed at less than ordinary income rates. Investors keep more of what they earn, and that’s especially important for those who opt into the fund’s DRIP, or dividend reinvestment plan.
The other major benefit of the REIT structure is that investors receive a single tax form—a 1099—delivered no later than mid-March. And they only pay income tax in the state where they reside, even if the REIT has property in multiple states. By contrast, private funds that utilize partnership structures produce K-1s. These typically take more time to prepare and may need to be filed in each state in which the fund invests, if those states have income taxes.
1) Calculation assumes an average 5% state income tax. Federal tax rate of 30.7% is based on $750,000, married, filing jointly, standard deduction, 2025 tax brackets.
Flexibility, Focus Drive Results
The aim of the IncomePlus Fund is to provide tax-efficient income and appreciation by building, buying or financing depending on where attractive opportunities and potential for risk-adjusted returns in the multifamily sector can be found. This three-pronged approach—acquire core stabilized properties, develop new assets and provide preferred equity—proved especially valuable during the past several years.
When property prices soared above replacement cost, the fund leaned into development and preferred equity investments, sidestepping acquisitions that could have exposed investors to overvalued assets. As the market shifted and opportunities to buy below replacement cost emerged, the fund pivoted back toward acquisitions. Our disciplined approach to risk management has guided this “all-weather” fund through a pandemic, steep interest rate hikes, bank collapses, the highest inflation in decades, and tariff announcements.
1) The investment period is from 3/31/2019 to 6/30/25. Returns are inclusive of appreciation and reinvestment of distributions and are net of fees. An investment in the Fund has the potential for partial or complete loss of funds invested. Returns are not guaranteed. Past performance is no guarantee of future results. All investments involve a degree of risk, including the risk of loss.
Our focus on tax efficiency and a disciplined investment approach is particularly relevant for investors looking to maximize long-term, compounding returns. Because the fund is open-ended, there’s no pressure to sell assets at inopportune times. We play our strategy out over full market cycles.
Portfolio Positioning and Risk Management
Over the past year, the IncomePlus Fund has started increasing its focus on real estate acquisitions. The move is designed to capture more upside as asset values recover and fundamentals improve.
These changes aren’t taking place overnight. In June 2024, the fund was tilted 66% toward preferred equity real estate interests. This was a defensive posture designed to navigate volatility and protect capital. We prioritized safety and income while the market worked through disruptions from interest rate hikes, inflation and supply chain issues.
Today, the portfolio is split between real estate (42%) and preferred equity real estate interests (58%). The goal is to reach a 60% real estate and 40% debt/preferred equity mix by next year. This will position the fund to benefit from asset appreciation as we see fundamentals continuing to improve. As the fund receives returns on its current preferred equity investments, it redeploys capital into new multifamily real estate acquisitions, which stand to gain from a market recovery.
The diverse mix of assets—core stabilized multifamily properties, ground-up developments (capped at 20% of capital), and loans or preferred equity investments—allows the fund to adapt to market cycles. We are managing this evolution conservatively and focusing on maintaining liquidity, managing risk and monitoring market conditions. Our aim is to capture upside as the market recovers, while still protecting downside and the fund’s ability to provide stable income.
*Future allocations are targets and not guaranteed.
Asset Update: Refinancings and Leasing Momentum
Ongoing improvements and refinancings across the IncomePlus Fund portfolio underline our focus on operational enhancements and prudent property-level financial management. This strengthens cash flow, enhancing property value, reducing risk and supporting long-term value for investors. Here’s how we are putting these strategies into practice at two properties:
Rye Charlotte, Nashville, Tenn.: The property was refinanced into five-year fixed-rate debt, moving away from variable-rate construction financing. This reduces exposure to interest rate volatility and allows for more predictable cash flows, which helps stabilize returns for the fund. Leasing momentum has been strong, with 32 leases per month (well above the typical 15 to 20 modeled), and 93% current occupancy. Operational enhancements include guest parking and a mini market—each designed to increase ancillary revenue and improve tenant experience.
Reverie Belmont, Belmont, N.C.: The property, which is 81% leased, was refinanced with 10-year Freddie Mac fixed-rate debt, allowing the fund to pull out cash, demonstrate value creation during construction and provide additional liquidity for the fund. It is sharing management resources with another fund property, Charlotte NoDa, which reduces overhead and increases operational efficiency. While concessions are currently higher than modeled due to elevated supply, we expect these to be temporary. The focus on operational leverage and cost control helps maximize net operating income, supporting distributions and long-term value for investors.
On the preferred equity side, we are taking a conservative approach. In some cases, even when external valuations would have allowed for a write-up in asset value, we chose not to recognize additional gains, prioritizing prudence and stability. We intend our disciplined management to protect investor capital and maintain a resilient portfolio as the market continues to evolve.
Upgrading the Fund’s Valuation Process
The fund has always had a comprehensive valuation process. This year, we have taken a significant step forward by undergoing quarterly valuations of our common equity assets by Altus Group. Before we moved to Altus, we conducted internal valuations throughout the year on our real estate investments and corroborated those values with a year-end appraisal process. Since then, two things have happened. Altus corroborated that we were using best practices in our valuation methodology. And we saw that its approach to underwriting is more aggressive than ours. We could have written up the share price more, but we opted to remain more conservative.
We’re also working with Altus to adopt a framework around our preferred equity positions. By working with Altus and ensuring that the fund’s net asset value is updated regularly and objectively, we aim to provide investors with a clear and current picture of portfolio value.
Long-Term Tailwinds for Multifamily
One of the most significant tailwinds for multifamily is persistent demand from renters, many of whom are priced out of homeownership due to high mortgage rates and rising home prices. The national housing shortage continues to put upward pressure on occupancy and rents, even as the pace of new apartment construction slows. Recent data show that multifamily starts are down sharply from their 2022 peak, and permitting activity has declined as developers respond to higher financing costs and economic uncertainty.
Source: Newmark Research, Atlanta Federal Reserve (July 8, 2025)
The IncomePlus Fund’s strategy has allowed it to navigate a complex environment and position for future growth. For those seeking more detail on the fund’s approach, performance, or market outlook, additional information is available at origininvestments.com.
Looking Forward
As the market transitions, we expect multifamily assets to benefit from a combination of strong demand, limited new supply and the relative affordability of renting compared to owning. Our disciplined management, strategic agility and focus on operational excellence has borne results in terms of the fund’s performance. But even as we are optimistic that the market recovery will continue, macroeconomic risks remain on our radar. The fund’s ability to tilt among development, acquisitions and financing will continue to provide resilience and the potential for outperformance as the market evolves. And we will —and we’ll maintain a balanced perspective and prudence in this complex, evolving market.
