Blackstone Raises $5 Billion Rental Bet With Lending Arm


Vacant Homes

Blackstone Raises $5 Billion Rental Bet With Lending Arm

Blackstone Group LP (BX), the private-equity firm that has spent $5 billion on more than 30,000 distressed houses, is preparing to expand its bet on the housing recovery by lending to other landlords.

The firm, which already owns more rental homes than any other investor, has set up B2R Finance LP to offer loans starting at $10 million, according to four people who reviewed the terms. B2R is reaching out to landlords with portfolios of properties seeking to grow in the burgeoning industry for single-family homes to rent, said the people, who asked not to be identified because the discussions are private.

The world’s largest private-equity firm said last month that it was entering the later stages of its buying spree after leading a group of institutional investors who’ve spent at least $17 billion on more than 100,000 homes over two years, helping fuel the fastest price gains since 2006. By increasing its stake in the rebound through lending, New York-based Blackstone could benefit from smaller landlords already investing in what Goldman Sachs Group Inc. estimates to be a $2.8 trillion market.

“The more financing that comes to the space, the better to legitimize the industry,” said Sudha Reddy, chief executive officer of Haven Realty Capital LLC, an investor with 1,500 rental homes backed by Leon Black’s Apollo Global Management LLC. “Not all investors are able to get a large credit facility and small ones from community banks aren’t big enough.”

Rest from Bloomberg here…


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