Politics & MoneyReal Estate

Altisource Residential boosts single-family rental portfolio with $305.1M deal with Amherst

Acquisition of 1,957 homes pushes total portfolio to more than 12,000

Earlier this year, Altisource Residential grew its portfolio of single-family rental homes to more than 10,000, thanks to the second part of a three-part deal with Amherst Holdings.

Under the terms of the deal, Altisource would acquire up to 3,500 single-family rental properties from “entities sponsored by Amherst Holdings.”

Now, the two companies have completed the third part of that deal, with Altisource acquiring an additional 1,957 single-family rentals from Amherst for an aggregate purchase price of $305.1 million.

In total, Altisource acquired 3,465 rental homes from Amherst under the deal the two companies signed back in March. The total sale price for the properties is $534.9 million.

This latest acquisition pushes Altisource’s single-family rental portfolio to more than 12,000 homes.

It’s a far cry from where the company’s single-family rental portfolio stood just two years ago.

Two years ago this month, Altisource’s portfolio of single-family rental homes checked in at 777 homes. Then Altisource nearly tripled its portfolio in a deal with Invitation Homes, acquiring 1,314 single-family rental homes for $111.4 million.

After that, the company made several significant acquisitions, including several deals with Amherst, one of which included buying more than 4,200 properties at once.

Including that September 2016 sale of 4,262 properties to Altisource, Amherst has sold more than 7,700 single-family rental properties to Altisource over last 14 months.

Now, the three-part deal with Amherst is done and Altisource’s portfolio tops 12,000 properties.

According to Altisource, just as it did with the first two parts of this deal, the company received seller financing of 75% of the purchase price pursuant to two separate loan agreements, each with a term of five years and a fixed interest rate of 4%.

“The consummation of this closing under the Purchase Agreement with Amherst marks the final piece of this important transaction for RESI,” Altisource CEO George Ellison said. “Our rental portfolio now exceeds 12,000 homes, which we believe enhances our ability to provide stable cash flows and build long-term value for our shareholders.”

Under the terms of the deal, Amherst Single Family Residential will remain the property manager for the 3,465 properties through its subsidiary, Main Street Renewal.

“We are pleased to have successfully executed our commitment to Altisource Residential pursuant to our 2017 Agreement,” said Drew Flahive, president of Amherst Single Family Residential.

“This further exemplifies our platform’s ability to identify, acquire, renovate, lease, and ultimately deliver portfolios of professionally-managed, cash-flowing rental properties to third parties,” Flahive added. “We expect to continue to scale operations and capital commitment to the single family residential sector to help facilitate continued institutional investment in this asset class.”

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