Advenir, Oakley Group Form BFR Partnership

LEO at Augusta Commons. Image courtesy of Advenir Oakley Capital

Advenir, a multifamily investor, developer and operator, and Oakley Group, a multifamily investor and developer, have formed a partnership to develop and acquire a portfolio of single-family rental and built-for-rent properties in the Southeast and Midwest. Called Advenir Oakley Capital, the new partnership aims to accumulate a portfolio of 8,000 units by 2025.

Striving to become a major player in the growing BTR sector, Advenir Oakley Capital plans to partner with investors, developers and municipalities to reach their goal by 2025. The partnership already acquired two communities in the fourth quarter of 2021. The properties are LEO at The Sanctuary, a 208-community in Savannah, Ga., and LEO at Augusta Commons, a 207-unit community in North Augusta, S.C. Advenir Oakley Capital also have a pipeline of about 4,300 units in various stages of pre-development and development across 14 properties.

The properties that will be developed are located in Alabama, South Carolina, Florida, Wisconsin, Indiana, Georgia, North Carolina and Ohio. Groundbreakings will begin this quarter and the first deliveries of developments are expected by the second quarter of 2023.

Advenir Oakley Capital is seeking opportunistic acquisitions while at the same time pursuing developments deals. To date, the partnership has closed on three deals for 612 units. The plan is to also build scale in the target markets with at least two to three deals in each market.

‘Bullish on BTR’

“We are bullish on the BTR space and believe the market has been waiting on this product type for a long time. We are building to hold and therefore putting more thought and resources into the design, architectural details, construction quality and livability of our communities,” David Oakley, founder & CEO of Oakley Group, told Multi-Housing News.

Oakley said renters previously had limited choices because most developers stuck to the basic garden-apartment design with three- to four-story buildings and surface parking.

“Research and data clearly show there is a strong market for renters or would-be renters who want to live in a BTR community,” Oakley said, adding leasing velocity for BTR communities are averaging 1.5 to 2 times the average garden apartments in the same areas.

“Although our developments cost more upfront, we are willing to meet our target market and build what the resident wants and they are willing to pay it.  This is what you call a win/win,” Oakley told MHN.

The partnership said the SFR and BTR market is growing with cross-generational demand spurring the sector. Millennials who are ready for homes of their own but may be priced out of home ownership as well as empty nesters and baby boomers seeking to downsize are among the demographics attracted to BTR communities.

There have been an increasing number of partnerships formed in recent months targeting the SFR and BTR sector. Early last month, Heitman and Sylvan Road Capital teamed up to build up a portfolio of SFR properties across the U.S. Heitman formed the joint venture on behalf of an affiliate of the firm. The joint venture is looking to acquire more than 3,000 single-family homes in several U.S. markets. In December, MORE Residential and Stockbridge Capital Group also formed a partnership to acquire SFRs in high-growth U.S. markets in the U.S.