International investment firm Colony Capital has committed $2 billion to the acquisition of single-family homes across America to release onto the rental market; the first stop is South Florida.
The company plans to buy an estimated 1,000 South Florida homes to renovate and release for rental within target locations including St Lucie, Palm Beach, Broward, Miami-Dade, Tampa and Orlando, according to Justin Chang, CEO of Colony America Homes.
Mr Chang said: “We think as the overall market recovers, Florida is a good place to be for the long term”. He went on to explain the company’s intentions, saying: “We’re not looking at buying and flipping. We’re buying and rehabbing and renting to families with children and pets who want to be in a single-family home.”
This is a growing trend amongst large investment companies, with investment firms and hedge funds already having purchased Florida homes in their thousands, according to a report released from RealtyTrac in February. The figures in question revealed that investment firms purchased an estimated 5,300 homes across the state last year, with distressed homes being the main target for buyers.
The focus of Colony Capital, in partnership with Miami Lakes-based Sovereign Real Estate Group, is based around three- and four-bedroom homes that can be purchased through a short sale or the Multiple Listing Service. The homes will be renovated and released for rental.
“We’re really building a business for the long term,” said Mr Chang. “Homes have never been more affordable, but it’s hard in a lot of cases for a homebuyer because there isn’t credit available.”
