Walker & Dunlop Structures co-GP Venture for Build-for-Rent Development Portfolio
The Walker & Dunlop team, led by Heather McClure, advised its client, Good + West, in identifying a joint general partner who will provide both funding and support in executing this business plan. Good + West currently has a construction pipeline of over $150,000,000 and plans to complete approximately $400,000,000 Perch developments over the next four years. The Walker & Dunlop team has identified a dallasNew York-based private equity fund as an ideal capital partner for Good + West.
BFRs are purpose-built housing to be operated as single-family rental investments within a contiguous community, much like traditional multi-family properties. This relatively new asset class is becoming one of the fastest growing sectors in commercial real estate, and an estimated 5-10% of new home construction is BFR. The product has steadily increased in popularity due to current demographic trends related to millennials and baby boomers. As more young couples, people with children, and retirees seek to rent single-family homes with high-end yards and amenities long-term, COVID-19-related migration patterns have accelerated demand. Additionally, as demand for BFR properties increases, an increasing number of large investors are expanding their investment strategy to include the product.
Along with the growing popularity of BFR properties, Perch’s portfolio will include several dedicated rental communities, offering a premium product with outdoor spaces, exceptional design and family friendliness. Initially innovate in Texas’ Dallas-Fort Worth and the Austin metropolitan areas, the new partnership will respond to increased migration and the rapid growth of each city’s workforce. Austin, in particular, has recently been dubbed “Silicon Hills” as major tech companies such as Hewlett Packard Enterprises, Oracle, and Tesla are establishing a presence in the region. With employment growth outstripping housing supply, the regions are perfectly suited to the development of the RFB.
“The Walker & Dunlop team brought their acumen and skill to this transaction,” said Elizabeth Good, partner at Good + West. “The team met and exceeded the demands of this complex and highly nuanced development concept. Their knowledge of the local market and their advisory role was essential in helping us find the ideal co-GP, enabling us to launch the first of several projects funded by the company.”
Ms. McClure commented, “Good + West has over 30 years of combined experience in multifamily development, asset management and finance. They are perfectly prepared to deliver unique and well-designed projects that are perfectly suited to the BFR market. She added: “This transaction is a testament to our dedicated BFR practice group and Walker & Dunlop’s exceptional platform, which is constantly innovating to meet ever-changing market needs.
Good + West recently opened the company’s first project, Perch Denton, a 195-unit property that will be delivered in 2023. Visit the new Perch website to learn more.
Walker & Dunlop and its dedicated BFR & SFR practice group are strategically positioned across the business to fund and sell these specialist communities. Our national team provides expert advice on property sales, debt issuance and equity structuring to generate optimal returns and strategic relationships for our clients. The team has closed $1 billion in this growing sector and is active with more than fifty groups in the space, ranging from institutional clients, home builders, multi-family developers and individual investors. For more information on lending, capital intermediation or investment sale opportunities, contact our SFR & BFR group at [email protected]. To learn more about Walker & Dunlop’s vision for the SFR and BFR market, download our white paper here.
About Walker & Dunlop
Walker and Dunlop (NYSE: WD) is one of the largest providers of capital to the commercial real estate industry, enabling property owners and operators to bring their vision of communities to life – where Americans live, work, shop and play. The power of our people, our leading brand and our cutting-edge technology make us more insightful and valuable to our customers, delivering an unparalleled experience every step of the way. With over 1,400 employees in all major US marketsWalker & Dunlop has consistently been named one of FortuneThe best places to work® and is committed to making the commercial real estate industry more inclusive and diverse while create meaningful social, environmental and economic change in our communities.
SOURCEWalker & Dunlop, Inc.