Bezos-backed Arrived Homes is latest startup to expand real estate investment

Arrived Homes joins Fundrise in allowing small-time investors to buy shares of rentals

National /
Jun.June 18, 2021 12:44 PM
Salesforce CEO Marc Benioff and Amazon's Jeff Bezos are backing the startup (Getty, Arrived)

Salesforce CEO Marc Benioff and Amazon’s Jeff Bezos are backing the startup (Getty, Arrived)

A startup backed by Jeff Bezos and Salesforce CEO Marc Benioff is the latest venture working to extend real estate investing to the masses.

Arrived Homes, a company that offers shares of rental properties starting at $100, raised $37 million in equity and debt from investors that include the Amazon founder’s private investment company Bezos Expeditions and Benioff’s Time Venture in a fundraising round led by Core Innovation Capital, Bloomberg reported.

Arrived Homes isn’t the first startup trying to expand real estate ownership. Fundrise, reestablished in 2016 as a REIT, allows non-accredited investors to buy shares of single-family, multifamily or industrial buildings for as little as $500.

Fundrise recently secured a $300 million credit facility from Goldman Sachs to finance new construction on investable single-family homes and has outbid institutional investors trying to acquire new rentals. In December, it swiped a new rental development in Texas out from under larger firms with a $1 billion bid.

Fundrise has acquired or is under contract for about 2,000 homes and plans to buy more than 25,000 over the next few years, according to Bloomberg News, magnitudes greater than Arrived Homes’ haul.

Arrived Homes has acquired just 15 homes and holds contracts for 18 more. Funds raised will go toward growing that portfolio, which Arrived Homes hopes will hit 100 houses by year’s end.

Other startups such as Roofstock allow more wealthy investors to own rental shares. And NestEgg, another venture-capital-backed startup, is building a more direct investment base. CEO Eachan Fletcher hopes to create a million millionaires in the next five years by allowing individual owners to acquire more buildings through property management and financing software.

Arrived Homes’ approach is most similar to that of Fundrise: It allows U.S. residents to buy shares of properties regardless of wealth or income. The billionaire-backed firm contracts with property managers to allow investors to buy homes across markets, Bloomberg said.

The company’s average investment is $1,800 across two or three houses.

Rental homes got less attention from big investors until the pandemic boosted demand for non-urban living. Large firms like Brookfield Asset Management and Nuveen Real Estate have since committed billions to buying rentals, the publication reported.

[Bloomberg] — Suzannah Cavanaugh

Correction: Fundrise allows investors to buy shares of buildings for as little as $500. The amount was misstated in an earlier version of this story.





    Related Articles

    arrow_forward_ios
    (iStock/Illustration by Kevin Rebong for The Real Deal)
    Existing home sales hit 15-year high in 2021
    Existing home sales hit 15-year high in 2021
    Joseph Tsai, executive vice chairman, Alibaba (Getty Images, LoopNet, iStock)
    Office behind Joseph Tsai revealed as buyer in 220 Central Park South megadeal
    Office behind Joseph Tsai revealed as buyer in 220 Central Park South megadeal
    1107 Fifth Avenue and Richard Eisner (CityRealty, The New Jewish Home)
    EisnerAmper co-founder sells Carnegie Hill co-op for $35M
    EisnerAmper co-founder sells Carnegie Hill co-op for $35M
    A photo illustration of Vishal Garg, chief executive officer, Better.com (Better.com, iStock)
    Better.com CEO returns to role after Zoom layoffs controversy
    Better.com CEO returns to role after Zoom layoffs controversy
    (iStock/Illustration by Steven Dilakian for The Real Deal)
    Black mortgage applicants’ rejection disparity surges
    Black mortgage applicants’ rejection disparity surges
    Redfin CEO Glenn Kelman (Redfin, iStock)
    Service divide at forefront of Redfin discrimination suit
    Service divide at forefront of Redfin discrimination suit
    Milo Founder and CEO Josip Rupena (iStock, Milo Credit)
    Crypto-rich but can’t buy a home? Now you can
    Crypto-rich but can’t buy a home? Now you can
    Side's Guy Gal and John Wollberg
    Brown Harris Stevens defector kicks off Side’s entrance into New York
    Brown Harris Stevens defector kicks off Side’s entrance into New York
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...