Newly Formed REIT Sets Its Sights On Single-Family Homes

The multibillion-dollar alternative investment platform NexPoint is increasing its exposure in the single-family rental market through a newly formed real estate investment trust (REIT) in partnership with HomeSource Operations.

In a statement Thursday, NexPoint said the new REIT has an existing portfolio of more than 1,000 homes, which it expects to grow to several thousand homes by the end of the year. Bloomberg reported that NexPoint is seeding the REIT with $250 million in equity and debt, according to people familiar with the matter.

The NexPoint advised REIT will focus on acquiring homes built in 2000 and later and also target new construction build-to-rent homes. The REIT will primarily focus on high-growth secondary and tertiary markets in the Sunbelt and Southeast regions of the U.S.

An affiliate of NexPoint, NexPoint Real Estate Advisors, is the advisor to VineBrook Homes Trust, which already has a portfolio of roughly 22,000 homes.

There has been an increasing amount of activity from institutional investors buying and constructing single-family rental homes recently as the demand for rental units surges due to inflated housing prices and interest rate hikes.

Fundrise has acquired over 260 rental homes over the past seven months through its Goldman Sach’s GS backed Interval Fund and Growth eREIT, and the Swiss Investment Firm Partners Group announced earlier this week that it acquired more than 3,500 single-family rentals in the Sunbelt region of the U.S.

Related: New Real Estate Investment Offering: 4 Single-Family Rental Homes in North Carolina with 20.7% Target Annualized Return

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