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JPMorgan Chase, Haven Realty Capital Form JV To Acquire, Develop BTR Communities

One of the nation’s largest institutional investors is doubling down on the build-to-rent sector, signaling confidence in single-family rentals amid growing turmoil in the purchase market.

The asset management team at JP Morgan Chase & Co. has partnered with Haven Realty Capital to acquire and develop more than $1B worth of new BTR developments across the Sun Belt, according to a news release. The $415M equity joint venture supports Haven’s strategy of purchasing entire communities from homebuilders eager to offload inventory.

Bella View Apartments is one of Haven's existing BTR communities in Atlanta.

“The for-sale housing market has been significantly hampered by recession fears, inflation and rising interest rates placing a burden on homebuilders and their ability to add to the housing stock,” Haven founder and Managing Principal Sudha Reddy said in a statement. “We expect to be an active buyer/developer as the market evolves and opportunities become available over the coming months.”  

Founded in 2010, California-based Haven currently has 35 BTR communities comprising about 3,500 homes under development and management. The properties span nine states and are worth a collective $1.2B.

The JV will target developments with 50-200 homes, ranging from 1.5K to 2.5K SF. The acquisition of three communities in the Atlanta area is expected to be finalized in the next 90 days, per the release.

”We’re pleased to be able to partner with Haven to continue to provide the attractive, newly-built, larger single-family homes for rent that more and more American families seek,” Ryan Holgan, executive director of Real Estate Americas at J.P. Morgan Asset Management, said in a statement.

This isn’t the first massive investment JPMorgan has made in the single-family rental space. In May 2020, its asset management arm announced a $625M equity partnership with SFR giant American Homes 4 Rent to build about 2,500 rentals in high-growth markets, according to Housing Wire.

Back in 2020, JPMorgan’s interest in SFRs was motivated by a trend of suburban sprawl that rose to prominence during the pandemic, per Housing Wire’s report. This time around, the investment is underscored by rising mortgage rates and a lack of inventory that has forced many would-be homebuyers to remain renters. 

New for-sale housing starts have fallen to a two-year low, according to data released by the U.S. Department of Housing and Urban Development. Experts predict the Fed’s rate hikes won’t end until the spring, though forthcoming increases will likely be smaller than the .75 basis point hikes seen as of late, per CNBC.