Invitation Homes Inc., the single-family rental giant, struck a deal to manage homes for another major landlord at a time when scarce inventory of properties for sale is making it hard to expand.
Dallas-based Invitation Homes is taking over management of more than 8,500 homes owned by Starwood Capital Group, according to a letter viewed by Bloomberg. The letter — sent by a company that previously managed the homes for Starwood — didn't disclose terms.
A representative for Invitation Homes declined to comment. A Starwood spokesperson had no immediate comment.
Invitation Homes was founded in 2012 to acquire distressed real estate following the U.S. foreclosure crisis, and has generally focused on buying homes and renting them out. A sluggish market has made buying more difficult for investors and regular homebuyers alike, though Invitation did succeed in acquiring nearly 1,900 houses from Starwood earlier this year in a $650 million deal.
The company has also sought to expand into businesses related to its original strategy, such as forming ventures to acquire newly built homes and more expensive abodes, as well as offering rent-to-own contracts. Its total portfolio consisted of more than 86,000 properties at the end of June. Even so, Chief Executive Officer Dallas Tanner has been lukewarm on third-party management.
"It's not a high-margin business generally, property management," Tanner said on an earnings call in April 2022. "I think you really do want to have a strategic view as to why you would do that."
