Blackstone Group has been snapping up homes in South Florida at a rapid pace – 844 properties since October.
The private equity giant (NYSE: BX) started its Invitation Homes division last year to buy distressed homes nationwide, rehabilitate them and rent them out. It accelerated home purchases in January when it realized that home prices were rising, according to multiple media reports.
Invitation Homes spokesman Eric Elder said it has so far invested about $3.5 billion in more than 20,000 homes. South Florida is one of nine target markets.
There’s a high demand for single-family home rentals by families that desire the lifestyle, but can’t purchase a home, Elder said. The home renovation and rental market is mostly filled by mom-and-pop companies, so Invitation Homes can bring renters the stability and professionalism of a large organization, he added.
“We are exceeding the scale of the largest homebuilders in the country, and with that comes great efficiency of cost, as well as quality,” Elder said.
In South Florida, Blackstone has been buying properties under the name THR Florida, with an address at 1 Oakwood Blvd., Suite 250 in Hollywood. Court records break down the purchases as 373 in Broward County, 279 in Miami-Dade County and 192 in Palm Beach County.
Blackstone has grabbed homes in a variety of ways: bidding at foreclosure auctions, buying lender-owned homes and purchasing directly from homeowners, including through short sales. It does not appear to buy mortgages.
It has dozens of South Florida homes listed for lease on www.invitationhomesforrent.com, but not every one of them is there. It appears that many need renovations before they are suitable for lease.
Blackstone has partnered with Riverstone Residential Group to handle home maintenance. Elder said it has 1,000 employees, and more than 10,000 contractors, responsible for due diligence on purchases, renovating and maintaining the homes.
“We aren’t anywhere near being flippers,” he added.