Single family rentals are one of the oldest asset classes around representing 15 MM units (1/3 of all rental housing and 15% of all single family housing), but up until very recently have lacked the critical mass to enable institutional investment. The post-2008 crisis in the housing market in many US cities has created attractive investment entry points for REO to Rentals on a large scale. Critical nuances in this segment are the selection of attractive city sub-markets with sufficient available product density to enable economies of scale in local property management. Many believe that single family homes will be a brand new institutional asset class.
In this segment, our value added has been the design of property management and redevelopment processes that minimize the need for local density utilizing technology and vendor management, along with investment and acquisition strategies targeting city sub-market selection, price points, and unit physical characteristics. Deal flow was determined from US Treasury, GSE, HUD, and private market participants, identifying delinquent homeowners to offer rental conversions. Capital markets strategy drove the novel adoption of a public Master Limited Partnership with the General Partner domiciled in the USVI to enhance after tax returns.