Rental-Home Loans To Be Packaged
B2R Finance, a new Blackstone unit that lends to investors that buy single-family homes and rent them out, is aiming to float a securitization by the middle of the year.
The size of the multi-borrower transaction, which would be the first of its kind, will likely be less than $500 million. An underwriter has not yet been selected.
Blackstone’s Tactical Opportunities Fund rolled out B2R in November to write loans of $500,000 to $50 million on portfolios of rented single-family homes. While a portfolio can contain five to 500 homes, B2R’s focus is on the lower end of that scale.
“If you’re an entrepreneurial investor, with 15 rental homes, there is no institutional-capital lending in your space right now,” said B2R president John Beacham. “You might find a few regional banks doing it, but not many. We intend to fill that void.”
The maximum loan-to-value ratio is 75%.
This month, New York-based B2R hired Justin Short, a former managing director on Cantor Fitzgerald’s commercial MBS trading desk, to run its trading operation. Short, a managing director, reports to Beacham.
Anthony Cazazian joined the firm as vice president of originations late last year. He also reports to Beacham. Cazazian formerly worked at MC-Five Mile and Goldman Sachs.
Blackstone itself also invests in rental single-family homes. The fund shop’s Invitation Homes unit raised $479.1 million in the bond market in November via a securitization backed by a loan on 3,207 single-family homes that it had acquired from distressed sellers and rented out — so-called REO-to-rental properties. Deutsche Bank was the structuring agent, as well as co-bookrunner along with Credit Suisse and J.P. Morgan.
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