GI Partners is selling a 3,106-home portfolio to Colony Starwood, the single-family rental home real estate investment trust, for $815 million, the groups said Monday.
Colony Starwood previously managed the homes on behalf of San Francisco-based GI Partners. The single-family rental portfolio is located in major markets across the country, with about a third of the properties in southern California, according to a Colony Starwood filing with the Securities and Exchange Commission. Each geographical location has an at least 90 percent occupancy rate.
The acquisition expands Colony Starwood’s holdings by about 13 percent, and the REIT plans to sell about 400 homes that it does not want to hold long-term. Colony Starwood owned about 32,000 homes as of March 31, according to its first-quarter earnings report. The GI Partners portfolio comprised the bulk of the 3,900 homes it managed as of the end of the first quarter.
Fred Tuomi, Colony Starwood’s chief executive, said in a statement: “The GI portfolio acquisition presents an attractive opportunity for the company to efficiently convert a large portfolio of homes from managed to wholly owned assets, all within our current market footprint with concentration in the high-growth California market.”
The deal is expected to close in the third quarter.
GI Partners entered in the single-family rental strategy in 2011 with an investment in Waypoint Real Estate Group through GI Partners Fund III, according to its website. It was unclear as of press time out of which fund capital for the latest portfolio originated.
The third opportunistic fund was closed in October 2009 on $1.9 billion, according to PERE data. Investors included the California State Teachers’ Retirement System, which earmarked $400 million, and the Oregon Public Employees’ Retirement System, which committed $200 million.
WREG was sold to Colony Starwood’s predecessor, Starwood Capital Group, in 2013.
GI Partners manages $14 billion in real estate and private equity commitments, according to its website.