Add release notes for v1.16.5

Author: willie-yao

CHANGELOG/v1.16.5.md

@@ -0,0 +1,24 @@
+## Changes by Kind
+
+### Other (Cleanup or Flake)
+
+- Bump CAPI to v1.7.9 ([#5330](https://github.com/kubernetes-sigs/cluster-api-provider-azure/pull/5330), [@mboersma](https://github.com/mboersma))
+- Improves state update handling when running long operations on VMSS ([#5328](https://github.com/kubernetes-sigs/cluster-api-provider-azure/pull/5328), [@mweibel](https://github.com/mweibel))
+
+## Dependencies
+
+### Added
+_Nothing has changed._
+
+### Changed
+- github.com/coredns/caddy: [v1.1.0 → v1.1.1](https://github.com/coredns/caddy/compare/v1.1.0...v1.1.1)
+- github.com/coredns/corefile-migration: [v1.0.21 → v1.0.24](https://github.com/coredns/corefile-migration/compare/v1.0.21...v1.0.24)
+- sigs.k8s.io/cluster-api/test: v1.7.8 → v1.7.9
+- sigs.k8s.io/cluster-api: v1.7.8 → v1.7.9
+
+### Removed
+_Nothing has changed._
+
+## Details
+<!-- markdown-link-check-disable-next-line -->
+https://github.com/kubernetes-sigs/cluster-api-provider-azure/compare/v1.16.4...v1.16.5