Canada Pension Plan Investment Board (CPP Investments) and Greystar Real Estate Partners, LLC have formed a new joint venture to develop and acquire purpose-built single-family rental communities in the United States.
CPP Investments and Greystar have allocated approximately US$840 million in equity to the joint venture. CPP Investments will own a 95% stake and Greystar will own the remaining 5%.
“We’re pleased to make our first investment in the sought-after single-family rental sector alongside our existing partner, Greystar,” said Peter Ballon, Managing Director, Global Head of Real Estate, CPP Investments. “Purpose-built single-family rental properties are becoming more desirable for a large and growing segment of renters in the U.S., particularly families or other renters looking for more space without sacrificing access to urban centres.”
The joint venture will develop and acquire professionally managed rental communities consisting of detached or semi-detached homes and townhomes with private garages and backyards.
The partnership will target development areas that are near employment hubs, transit and retail centers across the sunbelt, mountain west and west coast regions of the United States. Greystar will operate and manage the portfolio on behalf of the joint venture.
“At Greystar, we pride ourselves on our ability to drive innovation across the rental housing industry, while increasing supply at the same time,” said Bob Faith, Founder, Chairman, and CEO of Greystar. “This new wave of purpose-built, accessible rental communities is giving new options to renters who are seeking more space in a safe and professionally managed, quality home. We are expanding the rental experience by providing families with the option of single-family homes while maintaining the same exceptional experience and sense of community of multifamily rental homes.”
The joint venture extends CPP Investments’ partnership with Greystar following the announcement of multifamily development opportunities in target markets in the US earlier this year and a purpose-built multifamily rental venture focused on Sao Paulo with Cyrela Brazil Realty in 2019.
In July 2021 the two partners launched a life sciences venture focused on the US, which will provide purpose-built lab and office space.