A new private market real estate investment trust is available to investors interested in adding real estate to their portfolios.
Fractional investments grant individual investors access to the historically resilient and appreciating real estate asset class. Investors who may otherwise have been unable to buy real estate because of often high financial barriers can purchase equity shares of a property.
Now, the fractional investment platform Arrived has created the Single Family Residential Fund designed to create income streams for investors across multiple properties and markets.
Investors in the fund are expected to receive yield distributions generated from rents received in addition to the long-term appreciation potential when the property sells. The typical investment holding period for each of the properties acquired by Arrived ranges from five to seven years, depending on the property and the market it's located in.
The real estate investment trust (REIT) will be managed by Arrived's investment team, which has researched and selected each of the properties offered through the platform to date. The fund managers seek single-family homes in key growth markets with upside value. The team considers job growth — often a driver of housing demand — infrastructure, scalability potential and a lower institutional investor presence to enhance long-term growth potential.
Aside from the eight properties in the fund, Arrived manages 300 properties. According to Arrived, the group's historical performance includes a 4.3% average annualized return equating to $3.5 million in total dividends generated for Arrived investors. These figures do not include returns generated from property appreciation as the properties have not yet reached maturity where the appreciation gains have been netted and distributed.
Source: Courtesy of Arrived
The eight properties included in the REIT are in Tennesee, Georgia, Alabama, Kentucky, Colorado and Texas. New properties will be acquired and added to the fund throughout the investment period with the cap set at $75 million in value.
The Ansley
Photo courtesy of Arrived
The Ansley is a four-bedroom home in Southaven, Mississippi, a suburb of Memphis, Tennesee. The single-family investment property was acquired for $312,000 and will be rented for $1,995 per month.
The Pearson
Photo courtesy of Arrived
The Pearson is a 2023 newly built home in Chattanooga, Tennesee. The local economy has seen considerable growth in recent years, driving demand for housing in the area. The investment should be relatively secure from adverse market conditions because of the diverse economy, which is built on manufacturing, education and the service industry.
The Harper
Photo courtesy of Arrived
Located in Augusta, Georgia, The Harper was acquired for $274,000 and will be rented for $1,895 per month. The property was built in 2020. The house features modern finishes, an attached two-car garage, four bedrooms, two bathrooms and over 2,100 square feet of space.
The Birkdale
Photo courtesy of Arrived
The Birkdale is in the Huntsville, Alabama, housing market and was acquired for $320,000. Huntsville has a burgeoning economy and is nicknamed Rocket City because of the number of aerospace and military employers in the area. The economic growth resulting from aeronautics and the military has provided a surge in housing demand that is expected to protect and improve the value of the Birkdale investment property.
The Amigos
Photo courtesy of Arrived
The Amigos is a new home built this year that has four bedrooms, an open floor plan and a large kitchen with granite countertops. The single-family investment property was purchased for $268,990 and is in the Louisville, Kentucky, housing market.
The Cambridge
Photo courtesy of Arrived
The Cambridge is a 2,152-square-foot single-family house in Bowling Green, Kentucky. The home features four bedrooms, an attached two-car garage, a spacious kitchen with stainless steel appliances and a large granite island. The property was acquired for $302,000 and will be rented for $1,995 per month once a tenant agreement has been reached.
The Miliken
Photo courtesy of Arrived
The Milliken is a two-story, nearly 2,400-square-foot home in Greeley, Colorado. The newly constructed single-family investment property features modern finishes and was purchased for $450,000, making the property one of the higher-end homes Arrived has acquired.
The house is expected to be rented for $2,595 a month, a rate that falls in line with the market averages. As housing demand has risen in Colorado, the Arrived team is projecting the new build to maintain occupancy throughout the designated holding period.
The Sabine
Photo courtesy of Arrived
The final home in the investment properties included in the fund is the Sabine, a 2,679-square-foot home in the Dallas-Fort Worth market. Arrived acquired The Sabine for $357,000 and will rent it for $2,550 per month. The two-story, brick home features four bedrooms and an attached two-car garage.
The Arrived investments team will continue looking for homes with promising upside to add to the portfolio to raise $75 million in total capital. The Arrived Single Family Residential Fund is active on the Arrived platform, and the minimum investment is $100.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.