JLL gets in rental home business

JLL CEO of capital markets Richard Bloxam and Roofstock CEO Gary Beasley (JLL, Roofstock, iStock)

JLL is entering the single-family rental game.

The commercial real estate giant is set to become a minority investor in Roofstock, an online rental housing investment platform, the Wall Street Journal reported. Roofstock will buy JLL’s Stessa, a real estate asset-management platform that has gained traction from smaller investors. It will also work with JLL clients who are interested in the single-family rental market.

“The single-family rental asset class is seeing strong demand from our investor clients — both private and increasingly institutional — and this investment will position our teams to offer unique insights and access to opportunities in this space,” said Richard Bloxam, the CEO of capital markets at JLL.

Establishing a new source of revenue is crucial for JLL, whose earnings fell more than 20 percent in 2020 because of the pandemic-driven decline in leasing, which is expected to be slow to recover this year.

The partnership with JLL, meanwhile, gives Roofstock “credibility with a lot of their customers who are looking to invest in U.S. housing,” the company’s CEO Gary Beasley told the publication. “They can dial in a strategy and our team will build those portfolios for them and manage the properties.”

The single-family rental sector has attracted investors since the Great Recession when they bought bundles of foreclosed homes and converted them to rentals. The pandemic has been a tailwind for the sector as urbanites fled from crowded cities and settled in suburban rental homes with backyards. A recent shortage of affordable rental homes led to the build-to-rent trend among investors.

[WSJ] — Akiko Matsuda