Pretium and Ares Management have agreed to buy Front Yard Residential in a deal valued at $2.4 billion.
If it’s finalized, Pretium and Ares would own and operate more than 55,000 homes across the U.S., making the newly combined company the second-largest single-family home landlord in the country, Bloomberg News reported.
The deal highlights Wall Street’s growing interest in the single-family rental space since the onset of the coronavirus. Blackstone Group, Nuveen Real Estate, and JPMorgan Chase have all invested in the sector since the pandemic began, according to Bloomberg.
Don Mullen, the current chairman of Pretium and former Goldman Sachs partner, founded Pretium in 2012. It sought to invest in single-family rental homes at a scale that made rental housing easier to manage.
Front Yard, which owns 15,000 homes, has struggled this year with major shareholders calling for the company to liquidate itself. The company puts itself on the market after settling with an activist investor last year.
In February, Amherst Holdings was set to buy Front Yard back for $12.50 a share, or about $2.3 billion. But the deal crumbled in May due to the coronavirus.
[Bloomberg News] — Keith Larsen