Meet the landlord with an unquenchable thirst for single-family rental homes
Amherst Residential has spent $404M on home buys since October, and plans to buy 10,000 more homes this year
March 07, 2019 09:00AM
Amherst Residential president Drew Flahive (Credit: Twitter, Pixabay, and PxHere)
One of the nation’s largest homeowners is planning to add an additional 10,000 single-family rental properties to its collection this year.
Austin, Texas-based Amherst Residential will buy both individual properties as well as groups of houses from large landlords who want to shrink their portfolios, Amherst president Drew Flahive told Bloomberg. The company will run most of the acquisitions as rentals through its property management subsidiary Main Street Renewal, which already manages some 20,000 rental homes across the U.S. It will also renovate some to sell.ADVERTISING
The move comes as shifts in demographics and a tighter market for home sales are leading more investors to rental homes. Pretium Partners closed a $1 billion fund last year, and Tricon Capital Group launched a $750 million joint venture with two institutional partners. Cerberus Capital Management also launched its own fundraising.
The main challenge is finding the homes, the report said. After the financial crisis, the single-family rental industry grew with companies like Blackstone Group snagging thousands of distressed properties. But as the market has recovered, cheap homes are harder to come by.
The key is having “a platform that’s broad enough to aggregate from smaller, midsized or institutional owner-operators,” Flahive said. “We want to buy and manage assets at a wide range of price points, so we need to have the ability to service those assets.”
Amherst has spent $404 million to purchase 2,400 houses since October — and is eyeing opportunities from other mergers and acquisitions. In February, Amherst bought about 450 properties from Front Yard Residential, a real estate investment trust that acquired most of those assets when it took over a larger portfolio. [Bloomberg] — Meenal Vamburkar