The build-to-rent home craze is picking up speed across the country, led by the Southwest. Some of the largest single family rental communities can be found in this region, with Phoenix one of the largest players in the game, but Colorado is not far behind.
Just recently, two build-to-rent communities were announced in Colorado Springs, two outside of Boulder and five for Denver, giving the Centennial State a strong pipeline of more than 3,000 units of single-family rental under development, according to various news reports.
These single-family rental homes are constructed as rental properties, often in communities with great shared amenities.
The segment is expected to keep growing nationwide. According to rentcafe.com and data from its sister company Yardi Matrix, nearly 14,000 units will open their doors to renters this year across the country. While still a small segment compared to traditional multifamily (330,000 units were delivered in 2021, marking a record year for new apartments), SFR is growing, fueled by trends in how we’re living due to the pandemic, headwinds and supply issues for first-time homebuyers, and other lifestyle choices.
As one of the top developers and managers of multifamily communities in the country, our company founded our Storia division in 2020, dedicated to building SFR across the country. We earmarked $800 million for this strategy. Since then, this segment has grown to become more than 15% of our whole portfolio, which is 77,000 units under management and $5.6 billion in total capitalization.
In the SFR category, we’ve been awarded 68 projects representing 8,959 homes in communities across the country (for projects both under management or under development by our team). We now manage 29 communities, representing 4,234 homes. Our total SFR portfolio is 97 projects, representing 13,193 build-to-rent homes.
We hired Chase Davidson to help us lead this division, and with the insights of Ashley Casaday, who leads our capital markets division, we remain bullish on this sector. We’re seeing more companies raising capital for SFR and creating property tech solutions to help manage these properties.
The appeal of single-family rental homes is broad. They give people more space during the pandemic and work-from-home-era, but combine the convenience of a professionally managed property with amenities like dog parks, pools and grilling stations. Some even sport their own yards or private areas for people with kids and pets.
And it’s not just younger or older generations that are flocking to single- family rental homes and communities – we see that it’s a great fit for new families, combined families, empty nesters and people who want to try out an area before they buy.
One thing many SFR communities have in common is the need for more space, which means the majority of them, or about 61%, are located in suburbs.
In March, we announced one of our most scenic SFR projects, in Longmont, outside Boulder near the regional LoBo trail.
“Our team is very intentional about where we locate our Storia communities,” said Steven Shores, RangeWater’s president and CEO.
“Not only will this area benefit from more single-family rental housing, it also will be one of our most beautiful projects, on 18 acres, with unparalleled mountain views and amenities in a thriving community.”
The community, called Lupine, will have 200 townhomes and 36 duplexes located a 10-minute drive from North Boulder, which will serve the growing tech jobs market.
When completed, the project will have one-, two- and three-bedroom options ranging from 788 to 1,423 square feet. Some homes will feature front yards, and community amenities will include a pool and pocket parks. With construction starting this year, we expect to begin leasing in late 2022, with completion in early 2024.
“This region needs more housing in general, and Longmont serves people who work in the growing tech industry in Boulder and the surrounding areas,” said Kim Sperry, RangeWater’s regional partner in Colorado and Arizona.
“People want to live near open space, trails, breweries, unique coffee shops, all of which make this one of
the most sought-after communities in the country. This is the perfect location for Storia.”
This is our third new build community in Colorado and our second Storia community, with the first being The Armory in North Boulder, which has 18 three-level townhomes as part of the larger residential village on the grounds of a former Colorado National Guard post.
By Karen Key, Managing Director of Build-to-Rent