The build-to-rent sector is poised for rapid growth over the next several years. Currently, the rental housing segment is serving aging millennials looking to start families but not yet able to achieve homeownership. However, Generation Z is standing in the wing ready to fuel long-term growth in the BTR space. According to Noam Franklin, a member of Berkadia's JV Equity & Structured Capital team, 43% of Generation Z prefers single-family living to apartment living in young adulthood.

"According to survey data from the National Apartment Association, 43% of Generation Z wants to rent single-family homes following the completion of their university education. With the current age range of Generation Z spanning six to 24 years old, the first wave of this cohort is just now starting to make an impact on rental housing demand," Franklin tells GlobeSt.com.

In addition, Franklin expects demand will grow alongside supply, which will be diverse. Ultimately, it could even pull people away from homeownership. "We also believe as more people visit their family/friends renting in BTR communities, they will start to weight the benefits of renting vs. owning and might be more inclined to sell their homes, particularly with current valuations of their properties at all-time highs," says Franklin.