Lennar Corporation, one of America's biggest housebuilders, declares a single-family rental marketplace worth $4 billion. The company's huge bet will purchase single-family homes and townhomes to convert them into rental properties.
Centerbridge, together with Allianz Real Estate and other high-quality investment firms, will lead a total equity investment of $1.25 billion for the venture.
According to CEO and Co-President Rick Beckwitt, a part of the premises will have a rent-to-own choice, allowing renters to purchase without providing a significant down payment. He added this latest initiative has the potential to grow at a scale that they don't believe is feasible for rivals in the single-family rental market. The establishment will provide uninterrupted access to Lennar's network of over 300,000 owned and operated homesites.
The action has been taken due to the spike in demand for single-family rental homes during the covid-19 pandemic. Some urban residents who can't afford to buy but need more area than an apartment could have migrated to suburban rental homes. According to William Rahm, the single-family rental industry senior managing director and international chief of property investment at Centerbridge will expect to function well in the near future. He is excited to collaborate with Lennar because of its size and ability to assemble a globally diversified selection of homes clustered in some of the nation's fastest-growing economies.
Headquartered in Fontainebleau, Florida, Lennar became the largest home building firm in the U. S. after acquiring CalAtlantic Homes in 2017. It was also listed as 154th rank on the Fortune 500 in 2019. Rialto Capital Management, the investor of six venture capital firms that provide funds to real estate and a creator of private mortgage loans for securitization, is owned by Lennar. The firm functions in 21 states and has built up to 53 apartment communities to date. Lennar is listed on the NewYork Stock exchange with a market capitalization of $30.381 billion.
Over 50,000 rental properties were constructed in the previous year. The Pacific Coast Capital Partners and California State Teachers' Retirement System reportedly announced a $1 billion joint venture to fund in the build-to-rent market. Quinn Residences recently announced that it had received a $500 million pledge from an unidentified sovereign wealth fund to develop millions of rental apartments in the Southeast.