Institutional buyer scoops up 100-plus rental homes in greater Orlando

GrowthSpotter contributor

A New York investment firm that has been sweeping up single-family rental homes nationwide has made another big push into central Florida.

Cerberus Capital Management spent $20.5 million for 113 homes, according to deeds dated Nov. 27. The portfolio includes 39 homes in Osceola County that sold for $7.3 million; 12 homes in Orange County that sold for $2.6 million; and 62 homes in Polk County that sold for $10.7 million.

Almost all of the homes were purchased from Colorado-based hedge fund, Wynkoop Financial.

This was the company's second major buy in Central Florida. Cerberus bought 120 homes in Orange County in September 2015 for almost $11 million.

Cerberus, a $30 billion global investor and asset manager founded in 1994, established a residential assets investment platform in 2008 to acquire distressed residential mortgage-backed securities following the global financial crisis. 

Cerberus’ affiliated property manager, FirstKey Homes, now manages more than 18,000 homes in 27 markets, making Cerberus one of the nation’s largest owners of rental homes. 

Representatives from Cerberus and FirstKey did not respond to requests for an interview.

Bloomberg reported in August that Cerberus was attempting to raise more than $500 million to buy single-family rental homes amid surging institutional interest in the asset class.

Large investors first started acquiring single-family rental homes following the 2008 housing crisis. Analysts now say institutional demand is picking up again as millennials move from apartments to rental homes for their young families.

The Real Deal real estate website in South Florida reported that Cerberus also bought about 200 homes in July in Miami-Dade, Broward and Palm Beach counties from a private equity group for $47 million.

The Orlando area is considered the nation’s top market for investors looking to buy and sell single-family rental properties. This summer, online marketplace Roofstock said Orlando outpaced Raleigh, Austin, Charlotte, Salt Lake City, Houston, Atlanta, Phoenix, Seattle and Tampa among the hottest markets.

At the National Association of Real Estate Editors’ spring conference in Las Vegas, Roofstock co-founder Rich Ford told GrowthSpotter the region’s strong tourism and employment growth, rental pool and affordable home prices combine to attract investors from across the country. 

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