Dive Brief:
- Camden Property Trust has entered the build-to-rent fray, starting construction on two properties near Houston in the third quarter. The first homes should be available next summer, according to an investor presentation.
- The Houston-based REIT is building 200 homes at Camden Long Meadow Farms in Richmond, Texas, for $80 million. The development will sit in Houston-based CJ Development’s 58-acre Grand Center at Long Meadow Farms master-planned community, according to The Real Deal. North of Houston, in The Woodlands, Camden is building the 89-home Camden Woodmill Creek for $75 million.
- In the company’s third-quarter earnings call in October, CEO Ric Campo said that the two development deals offer Camden an opportunity “to really understand the market and learn the market because I think it's a very compatible business with the regular multifamily business.”
Dive Insight:
Despite signs of slowing in the rental market, money continues to pour into the BTR space.
In 2021, investors spent $2.5 billion in communities of 50 or more units, according to John Burns Real Estate Consulting. That was well above the previous annual high of $887 million, posted in 2018.
The market hasn’t slowed in 2022.
In November, institutional investors advised by J.P. Morgan Global Alternatives formed a joint venture with Los Angeles–based Haven Realty Capital to acquire and develop more than $1 billion in new BTR communities around the United States.
With a $415 million programmatic equity joint venture, Haven will have the dry powder to execute its business plan in the BTR space while leveraging existing relationships and creating new partnerships with homebuilders throughout the Sun Belt.
In October, Charlotte, North Carolina–based Crescent Communities, in partnership with New York City–based investor Pretium Partners, announced the groundbreaking of two new BTR communities: Harmon Ballantyne and Harmon Five Points, both located in Charlotte. Like Camden, Crescent is known for building apartments.
Overall, more than 25,000 single-family rentals are under construction in the U.S., according to Yardi Matrix data. Rents and occupancy rates are high and new deliveries are expected to exceed last year’s record high of 7,705 by the end of the year.
“Given the long-term shortage of single-family homes and the high cost of homeownership, SFR occupancy rates are projected to remain high into the future,” said Paul Fiorilla, author of Yardi Matrix’s report on the single-family build-to-rent market.
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