Blackstone to spend $1B in affordable single-family rental expansion

Home Partners of America, rent-to-own portfolio company, to run program

Tri-State /
Jan.January 17, 2022 08:59 AM

(Blackstone)

Blackstone is planning a $1 billion move to expand its backing of single-family rental offerings, picking up homes that will be rented at below-market rates.

Home Partners of America, a rent-to-own portfolio company the investment firm acquired last year, will offer the Choice Lease program, Bloomberg reported. Eligible households include those earning 80 percent or less of their area’s median income. Accepted tenants would be able to receive a 10 percent reduction on monthly rent payments.

The program, which comes amid a nationwide housing shortage and rapidly rising home prices, follows Home Partners’ rent-to-own model capping the annual increase for a home’s purchase price at 3.5 percent, below the typical rate of appreciation for homes in most markets.

The company is expected to spend $1 billion on the program for 4,000 homes in the next two years, according to Bloomberg. While profit margins for Blackstone will decrease, the offer could help scale Home Partners’ offerings to those who couldn’t afford rent on the single-family homes before.

The program has already been tested in four markets, Bloomberg reported, including Atlanta and Phoenix, and is slated to debut in an additional 13 markets.

The investment giant jumped into single-family rentals with a $6 billion bet on Home Partners in June 2021. In buying the portfolio of 17,000 homes, Blackstone may have been banking on how an increasing lack of housing affordability could lead to a boom in rent-to-own homes.

Blackstone previously saw success with Invitation Homes, which the firm’s president Jonathan Gray built into America’s largest operator of single-family rentals before cutting bait in 2019.

[Bloomberg] — Holden Walter-Warner





    Related Articles

    arrow_forward_ios
    172 Cedar Street in East Hampton LI (Google Maps)
    Enormous East Hampton equestrian estate sold for $22M
    Enormous East Hampton equestrian estate sold for $22M
    Darien First Selectman Monica McNally and Great Island in Darien, Connecticut (Darien Republicans, Google Maps)
    Fairfield County town nears purchase private island for over $100M
    Fairfield County town nears purchase private island for over $100M
    From left: Oaktree Capital Management co-chairman Howard Mark; Helmut Lang; Hess CEO John Hess; and 8 Tyson Lane in East Hampton, Long Island (Getty Images, Oaktree Capital Management, Google Maps, Hess)
    Helmut Lang finally sells East Hampton estate
    Helmut Lang finally sells East Hampton estate
    A photo illustration of 17 Ridge Avenue in Spring Valley (Google Maps, iStock)
    Rockland County apartments deemed unsafe in enforcement crackdown
    Rockland County apartments deemed unsafe in enforcement crackdown
    Clockwise from top left: Eric and Bridget Elkin, Diane Mollica, Liz and Lisa Gillooly and Sarah Frigo (Compass)
    Compass aims to grow its North Fork agent count fivefold
    Compass aims to grow its North Fork agent count fivefold
    Schenectady City Council president Marion Porterfield (Facebook, iStock)
    Destructive tenants driving upstate landlords to despair
    Destructive tenants driving upstate landlords to despair
    Southampton Village mayor Jesse Warren (Getty Images, iStock, Illustration by Kevin Cifuentes for The Real Deal)
    Southampton Village allows owners to collect summer’s rent upfront
    Southampton Village allows owners to collect summer’s rent upfront
    (Top) 1580 Meadow Lane in Southampton NY and (Bottom) 2056 Montauk Highway in Amagansett NY (Zillow)
    A tale of two oceanfront Hamptons homes
    A tale of two oceanfront Hamptons homes
    arrow_forward_ios

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

    Loading...