Multibillion-dollar alternative investment platform NexPoint Advisors L.P., has partnered with HomeSource Operations LLC, in the formation of a new NexPoint advised real estate investment trust (REIT). The REIT will be used to acquire, build and operate single-family rental homes. It will target existing SFR properties and new construction build-to-rent (BTR) homes in high-growth markets.
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In the initiative to acquire existing SFR homes, the new NexPoint advised REIT will zero in on residences constructed no earlier than this century. The REIT will also target new construction BTR homes by leveraging strategic developer and building relationships. Emphasis will be placed on expeditiously growing secondary and tertiary markets across the Sunbelt and Southeastern portions of the U.S.
This newly announced initiative will enable NexPoint, as the parent of the adviser to one of the nation’s largest SFR home owners, to further enlarge its exposure to SFR.
“Keeping up with residents’ demand for affordable and quality single-family housing and ensuring that we continue to provide residents with excellent service and a great rental experience are and will continue to be key challenges,” Brian Mitts, chief financial officer for NexPoint Real Estate Advisors L.P. told Multi-Housing News.
“Fortunately, NexPoint has built a significant real estate business around multifamily housing, and we possess strong institutional knowledge with respect to how to run our business while balancing residents’ happiness. This experience and expertise will continue to be critical as we make a bigger push into the SFR space and broaden our exposure into new segments such as build-to-rent,” he added.
NexPoint expanded into the SFR market four years ago, and through an affiliate is now the adviser of a REIT that currently serves as owner and operator of more than 22,000 homes. As a result of the new undertaking, NexPoint will enjoy distinctive opportunities to avail itself of its wide array of capital markets capabilities. The result should allow the company to deliver innovative funding answers in acquiring SFR and BTR homes.
NexPoint anticipates that the current portfolio of more than 1,000 single-family residences will grow by several thousand by the end of this year.
“Our focus is on ensuring our residents continue to benefit from an optimal rental experience,” Mitts said. “To this end, we will continue to invest in our operations and our human capital and seek to partner with best-in-class entities, such as HomeSource. Ultimately, we want to continue creating value in optimally located, well-designed and consistently maintained homes. And we want to attract quality residents to help ensure long-term asset value.”