ATLANTA—Steven DeFrancis, CEO of Cortland Partners, is predicting multifamily can win big in 2016. He sees opportunities and he sees challenges.

In part one of this exclusive interview, he pointed out two key areas of focus to make that prediction a reality: increased need for a value-added approach and focusing on senior housing as a submarket. In part two, he's answering some pointed questions about Atlanta's multifamily market.

GlobeSt.com: Why are you optimistic about 2016 despite fears of multifamily oversupply?

DeFrancis: For the last several years, many in the financial markets have been predicting a coming correction in the multifamily housing industry. Initially, this prediction was primarily based on legacy measurements regarding propensity to rent, which later morphed into fear of a market oversupply that would cripple the future potential of the multifamily space.

Although 2015 has been a year of massive deliveries in most major markets, the supply has continued to hold up well. Furthermore, the continued growth in rental rates has pushed many renters who may have previously been a candidate for the top-tier product into well-located alternatives. This trend has pushed—and will continue to push—high-quality renters that have been priced out of costly urbanized neighborhoods towards communities that offer a high-quality living experience at a lower cost than what is seen in newly developed communities.

GlobeSt.com: What challenges do you see and how can developers overcome them?

DeFrancis: A number of recent reports and data add to the growing concern in the capital markets that the multifamily growth cycle is nearing the end of the business cycle. Regardless of the merit to these findings, developers can combat this possibility by finding new ways to create value. Specifically, bolstering one's renovation scale capabilities during times of growth will keep multifamily developers competitive in the capital markets, even if and when the market begins to pull back.