GTIS Shifts Focus to Build for Rent
The company expands its in-house single-family build-to-rent development team with new hires Gary Davis, Bill Mumford and Kurt Rouse.
In the wake of the housing crisis, GTIS carved out a niche in the single-family rental investing space. Now, the firm is shifting its focus to the build-to-rent space, developing large-scale purpose-built single-family and townhome rental communities. To that end, it is beefing up its talent bench.
GTIS hired head of Development Gary Davis, new senior director of Acquisitions and Development Bill Mumford and new vice president of Development Kurt Rouse to execute the new strategy. They join director of Acquisitions and Development Teddy Karatz and director of Asset Management Scott Bordogna within the firm’s single-family, build-for-rent platform.
“BTR is one of our highest conviction investment ideas and we are investing in our own execution capabilities in order to capture the market opportunity,” Tom Shapiro, president and chief investment officer at GTIS, said in a prepared statement.
As build-for-rent matures, capital is flocking to the space. As one example, Dan Gorczycki, formerly of Avison Young and now with TrueRate, recently closed a $71.5 million revolving construction loan for a build-to-rent project in Brandon, FL, by Brandon Development Partners. Corevest Finance is financing the horizontal and vertical construction of a 360-unit townhome project on an approximately 60-acre site.
An estimated 5 to 10% of all new builds are BFRs, according to Walker & Dunlop.
“BFR is a relatively new concept among SFR investors, national homebuilders, and developers,” the report states. “It has become increasingly popular to investors in recent years, including traditional multifamily developers. While the BFR market only makes up about 5 percent of new homes built, it is rapidly growing and will continue to do so as new entrants begin BFR operations.”
New entrants, like GTIS, will feed that growth. And GTIS isn’t alone.
Crescent Communities is launching a build-for-rent platform led by a former senior executive at Atlanta-based FirstKey Homes. The company’s BFR initial strategy centers around four major cities—Atlanta, Charlotte, Charleston, and Raleigh—and each community will consist of up to 200 residences, with a combination of three- and four-bedroom townhomes and/or detached single-family houses.
And in March, the Great Gulf Group partnered with Westdale Real Estate Investment and Management to develop, build, own and operate build-to-rent single-family housing communities in the Sunbelt.
Initially, The Great Gulf Group and Westdale committed $200 million of equity to the venture and may kick in an additional $200 million.