Tariffs, Volatility, and the Case for Dual-Diversification

 

Tariffs, Volatility, and the Case for Dual-Diversification
How Non-Performing Loans and Multifamily Real Estate Can Anchor Your Portfolio in Uncertain Times
As headlines warn of escalating tariffs and renewed trade tensions, investors are once again bracing for volatility. Supply chains are tightening, costs are rising, and inflationary pressure is starting to impact both businesses and consumers alike. In times like these, where can investors turn for consistency?

At PPR Capital Management, we believe the answer lies in a dual-diversified strategy: combining non-performing loans (NPLs) with multifamily real estate to deliver income, stability, and long-term resilience.

The Hidden Risk in Today’s Market

Tariffs don’t just affect imported goods—they ripple through the economy. Industries dependent on trade face margin compression. Borrowers struggle with rising costs. And banks, anticipating greater credit risk, begin tightening their lending standards.

This creates a domino effect:

• More borrower defaults, leading to a growing supply of distressed loans
• Slower new construction, putting upward pressure on rental demand
• Increased volatility across equities and traditional bond markets

For investors, this environment demands an approach that’s both defensive and opportunistic.

Why NPLs and Multifamily Make a Powerful Pair

Our fund strategy is simple: blend the income-generating potential of NPLs with the growth and stability of multifamily real estate.

1. Non-Performing Loans (NPLs): Income From Dislocation

NPLs are distressed mortgage assets purchased at a discount and secured by real estate. We’ve been investing in this space for over 18 years, generating consistent returns even through previous economic downturns. Tariff-related stress creates more opportunities for discounted purchases—allowing us to buy smart, work loans out, and generate strong cash flow.

2. Multifamily Real Estate: Demand-Driven Stability

Even in periods of uncertainty, people need a place to live. With interest rates and development costs rising, many would-be homeowners are renting longer. Our approach focuses on value-add and affordable multifamily properties in high-demand markets—assets that perform even when the broader economy stumbles.

Diversification That Works Together

Unlike traditional portfolios that rely heavily on the stock market or fixed income, our fund is grounded in two real estate-backed strategies that respond differently—but complementarily—to market stress.

• NPLs benefit when borrower distress rises
• Multifamily thrives as demand for rentals increases during economic slowdowns
• Both are backed by real assets, creating a layer of protection against inflation

This is not theoretical. It’s a model we’ve refined over nearly two decades—and one that continues to deliver in today’s challenging environment.

What This Means for You

If you’re an accredited investor looking for:

• Predictable income
• Lower exposure to market swings
• A strategy built on real estate fundamentals
  Then our fund may be the right fit.

We invite you to schedule a call to learn more about how our dual-diversified strategy works—and how it can help you meet your long-term goals, even in uncertain times.