Commercial Property : Commercial Property For Rent

Thursday 15 November 2012

Commercial Property For Rent

The push is on to turn single-family rental homes into an asset class that can be bought and sold on Wall Street.Last week, the Journal reported that publicly traded home-builder Beazer Homes had teamed up with buyout firm KKR & Co. to launch a real-estate investment trust to manage its small portfolio of single-family homes as rentals. Beazer’s REIT is still private, for the moment, but has plans for an IPO to take the company public in the coming years.Others are jumping in as well. Los Angeles-based Colony Capital, led by distressed debt investor Tom Barrack, has also formed a single-family rental REIT, based in Phoenix, with plans to ramp up acquisitions and expand to new markets in the coming months. Since dozens of prominent investors have signaled that they plan to make big bets on the single-family rentals, it’s useful to look at how these ventures are structured.“From the very beginning, we’ve thought of this as eventually becoming a public company,” says Justin Chang, a principal with Colony and acting CEO of Colony American Homes, the private-equity firm’s new rental REIT. “This is a big opportunity, the beginning of an asset class.”