Goldman Sachs-backed funds pay $45M for Florida community

Fundrise Interval Fund and Growth eREIT VII buy 87 single-family properties

(iStock, Illustration by Kevin Cifuentes for The Real Deal)
(iStock, Illustration by Kevin Cifuentes for The Real Deal)

Two Goldman Sachs-backed ventures have taken over a whole rental home community in Florida last month.

The firms — Fundrise Interval Fund and Growth eREIT VII — paid $45 million for 87 single-family properties in Brevard County, according to an Orlando NBC affiliate.

The move is part of an ongoing shopping spree. The New York Post reported Fundrise previously purchased a 120-unit development in Pensacola and has been buying rental developments in other Southern states like South Carolina and Mississippi.

As migration spurs soaring home prices and rents across the Sun Belt, the firms are positioning themselves in previously disregarded parts of the country, Florida Atlantic University real estate professor Ken Johnson told the Post.

Johnson said Florida has the same appeal as “as places like Texas and Tennessee and North Carolina,” and some parts of the state have morphed from a secondary-home market to a year-round community.

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As a result, rents have spiked by more than 30 percent across the state, a common trend in areas of the Sun Belt.

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In April, Miami edged out Boston as the third most expensive city to lease an apartment. As rents climbed to eat up more of tenants’ income, the Miami metro area also ranked as the most rent-burdened in the nation.

Even in the tight market, corporate purchases remain a “drop in the bucket” of overall home transactions throughout the country, Johnson told the outlet. The deals, even in concentrated areas, do not have the market power to dictate rental prices.

[WESH2] — Sasha Jones