American Homes 4 Rent To Launch ABS This Week

American Homes 4 Rent may become the third company to issue a deal backed by rental payments.

The company announced today that one of its affiliates — unnamed in the release — is launching a securitization of a loan that will be repaid by rental flows from a portfolio of single-family properties that American Homes will sell to an affiliate.

The deal is designed to cut the company’s cost of capital.

American Homes exclusively focuses on single-family rental investments. The company’s portfolio totaled 25,505 single-family properties as of March 31, 2014.

The securitization deal follows the April 3, $533 million transaction issued by Colony American Homes and The Blackstone Group’s Invitation Homes transaction issued in November 2013.

American Residential Properties in March announced that it planned to raise $300 million via a securitization of single-family rental properties. The REIT said it retained Deutsche Bank to serve as lead banker to assist in structuring and negotiating the securitization.