Cerberus nabs $616M CMBS loan on FirstKey single-family rentals

Manager’s portfolio spans more than 2,100 homes

National /
Nov.November 19, 2021 11:15 AM
Cerberus nabs $616M CMBS loan on FirstKey single-family rentals

Cerberus Co-CEO Stephen Feinberg (Cerberus, iStock)

Cerberus Capital Management, the parent organization of FirstKey Homes, landed a $616.1 million CMBS loan from Morgan Stanley, the Commercial Observer reported.

The loan is for five years at a fixed-rate, financing FirstKey’s 2,106-home portfolio. The investment and property manager firm counts more than 34,000 homes in its total portfolio, the vast majority of which are involved in CMBS securitizations.

The portfolio involved in this financing was assembled by FirstKey between June and August 2021, according to data from KBRA.

More than a third of the portfolio is concentrated in three major metropolitan areas: Atlanta, Charlotte and Phoenix. According to the Observer, the full portfolio spans 39 markets across 13 states, seeing a combination of Florida, Georgia and North Carolina account for more than half of the concentration.

KBRA data show the average size of the homes in the portfolio is 1,969 square feet. The average age of the homes, meanwhile, is about 20 years old. As of Nov. 4, 151 homes in the portfolio are vacant and not leased, while 31 are vacant, but with leases in place.

Single-family rentals are one of the housing market’s hottest sectors. The number of built-to-rent homes, essentially constructed as single-family rentals, soared by 30 percent from 2019 to 2020. Built-to-rent homes account for 6 percent of all homes being constructed nationwide, according to the New York Times, and represent the fastest-growing housing sector in the country.

The property type has been a boon for investors, too. Data from securities advisory Green Street reported last week show the expected risk-adjusted return on built-to-rent investments is 8 percent on average, which is higher than the weighted average return of 6.1 percent across 18 different sectors.

[CO] — Holden Walter-Warner





    Related Articles

    arrow_forward_ios
    L.A. Metro board members Sheila Kuehl, Hilda Solis and rendering of new transit stops with high-end condos in Pasadena and North Hollywood (SCNG photographers, LA Metro)
    The anti-NY strategy: LA transit buys land to stop gentrification
    The anti-NY strategy: LA transit buys land to stop gentrification
    Paul Simon, Edie Brickell, 82 Brookwood Lane in New Canaan, CT (Getty Images, Houlihan Lawrence)
    Slip slidin’ away: Paul Simon sells New Canaan estate at loss
    Slip slidin’ away: Paul Simon sells New Canaan estate at loss
    Pavilion A at the Woolworth Tower Residences (Travis Mark)
    Woolworth Tower apartment featured in “Succession” sells for $20M
    Woolworth Tower apartment featured in “Succession” sells for $20M
    From left: Tyler Whitman, Ryan Serhant, Kirsten Jordan, Frederik Eklund, and Steve Gold from "Million Dollar Listing New York" (Kareem Black/Bravo, iStock)
    Bravo pausing “Million Dollar Listing NY” after 9 seasons
    Bravo pausing “Million Dollar Listing NY” after 9 seasons
    Henry Wells and 158 Clinton Street (Wells Fargo, Street Easy)
    American Express tycoon’s 174-year-old townhouse tops BK luxury market
    American Express tycoon’s 174-year-old townhouse tops BK luxury market
    Samsung Heiress Lee Seo-hyun and 212 Fifth Avenue (Getty Images, Google Maps, iStock)
    Korean heiress buys 212 Fifth pad
    Korean heiress buys 212 Fifth pad
    From left: 56 Leonard Street and 443 Greenwich Street with Justin Timberlake and Jessica Biel (Getty, StreetEasy, iStock)
    TRD Pro: Ranking Tribeca’s priciest residential deals of the past year
    TRD Pro: Ranking Tribeca’s priciest residential deals of the past year
    Cooling, Market
    The stats don’t lie: NY’s housing markets are cooling
    The stats don’t lie: NY’s housing markets are cooling
    arrow_forward_ios

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

    Loading...