FeatherStone Investment Group is working on its first securitization of rental income.
In a press release issued Monday, the company said can now underwrite, structure, package and negotiate portfolios as a placement agent in the course of its business to special purpose entities in a manner that qualifies as a "true sale." The deal should be complete within the next 90 to 120 days.
It did not indicate how large the transaction would be.
“This is a huge structural achievement for FeatherStone Investment Group,” said Scott Manson, the group's general counsel.
FeatherStone Investment Group is now underwriting and structuring transactions through its private mortgage division, which provides funds to acquire or refinance rental income properties nationwide.
The group pools mortgages on single-family rental properties and issues securities to investors in the secondary mortgage market as a real estate mortgage investment conduit (REMIC).
It invests in markets where single-family rental properties offer 7% to 10% in annual rental distributions and the potential for a 35% increase in property values over the next five years.
In February the group said it had entered into a $75 million equity participation deal with Lambert Private Equity. FeatherStone used the funds to originate, securitize, purchase and expand service for REO-to-rental properties. The group said in Monday's press release that it is now seeking additional equity participation deals.