Two single-family housing landlords, 643 Capital Management and Five Ten Capital,are teaming up to offer loans to other firms acquiring rental properties.
The joint venture, Dwell Finance, is headquartered in San Francisco, and will serve borrowers across the country.
Five Ten was founded by Rob Bloemker, former head of fixed income at Putnam Investments; 643 was founded by Gregor Watson, a founding member of McKinley Capital Partners. Both firms have extensive experience buying and renting homes across the U.S., having combined purchases of over 4,000 homes and nationwide operations. They will continue to run separate real estate investment platforms.
"Our experience in buying, borrowing, and lending in single-family homes provides us with a roadmap for what does and doesn't work in this business," Watson stated in a press release. "We can offer effective financing solutions to both home investors and future bond holders.”
Dwell will offer three types of financing, according to information posted on its website: acquisition credit lines, term financing, and construction financing.
"We see this market taking off over the next few years. Single-family investors fall into a void between the traditional commercial and residential mortgage markets, leaving over $2 trillion rental homes currently owned without financing," Bloemker stated in the same press release.
Acquisition lines can be used to advance up to 80% of the purchase price, while loans with terms of up to five years can be used to purchase 70% of the purchase price, according to Dwell’s website.