Stockbridge MORE Communities secures $780 million for build-to-rent acquisitions

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May 31, 2023, 09:00 ET

Covey Homes owner completes new financing

PLANO, Texas, May 31, 2023 /PRNewswire/ -- Stockbridge MORE Communities, owner of build-to-rent single-family communities operating nationwide under the Covey Homes by MORE brand, today announced a $380 million upsize of its existing acquisition warehouse facility, bringing its current warehouse facility capacity to $780 million. Cumulatively, Covey Homes has nearly $1 billion in financing to pursue acquisition opportunities throughout Sun Belt states.

With equity commitments and other funding sources, Covey Homes has gross purchasing power of more than $4 billion.

Nomura joined Bank of America and other lenders in funding the acquisition warehouse facility, which will be used by Covey Homes to acquire build-to-rent communities throughout the Sun Belt.

"This facility expands our opportunity to more rapidly build out our Covey Homes platform,'' said Mark Alfieri, Chief Executive Officer of MORE Residential. "Millennials and Baby Boomers are embracing the hassle-free single-family rental experience as they discover that our professionally managed and maintained communities offer prices that are competitive with, and often less than, the all-in costs of owning a home.''

Covey Homes now owns and operates more than 2,000 completed homes in 15 communities in the Southeast and Texas. The company has approximately 3,000 more homes in development.

"We are accelerating our acquisition activity amid strong demand for high-quality single-family housing in well-maintained communities in desirable locations,'' said Alex Lachman, Portfolio Manager at Stockbridge. "This funding provides Covey Homes with even more firepower to pursue new acquisition opportunities in the fast-growing build-to-rent market.''

Formed in 2021, Stockbridge MORE Communities is a joint venture between San Francisco-based investment firm Stockbridge and Plano, Texas-based MORE Residential, led by the former management team behind Monogram Residential, a publicly traded REIT that was sold in 2017. The venture now brands all of its communities as Covey Homes.

Covey Homes communities offer a carefree, tech-enabled lifestyle, beginning even before move-in with self-guided tours of homes and after with easy-to-use smart-home capabilities. Covey Homes communities generally consist of 50 or more homes with modern finishes and high-quality amenities, such as clubhouses, fitness centers and swimming pools. The Covey Homes brand offers professional management and maintenance teams, all at an accessible price relative to home ownership.

About Stockbridge MORE Communities
Stockbridge MORE Communities was formed in June 2021 with a mandate to acquire purpose-built single-family rental communities throughout the United States. The venture was formed by Stockbridge Capital Group, a real estate investment manager, and MORE Residential, an owner and operator of residential communities throughout the United States. Day-to-day management of the venture is led by MORE Residential, with Stockbridge contributing to overall investment strategy execution. Stockbridge MORE Communities maintains gross purchasing power of over $4 billion for single-family build-to-rent communities throughout the United States.

About MORE Residential
MORE Residential was formed by the senior management team behind the former publicly traded REIT, Monogram Residential, which created a residential portfolio exceeding $4.5 billion in total value that eventually sold to an institutional investor consortium in 2017. The MORE management team averages 30+ years of real estate industry experience and has extensive expertise working with institutional investors and development sponsors to invest capital through structures that maximize opportunities at various stages in the investment life cycle. MORE's focus is on residential rentals spanning lower-density single-family rental (SFR) and build-to-rent (BTR) communities to traditional high-density multifamily properties across U.S. markets.

About Stockbridge
Stockbridge is a real estate investment management firm led by seasoned senior professionals averaging 25+ years of real estate industry experience. The firm was founded in 2003 and manages real estate equity investments across the risk spectrum within a variety of investment structures on behalf of U.S. and foreign institutional investors. Stockbridge has approximately $33.7 billion of assets under management (as of December 31, 2022) spanning all major real estate property types, and certain specialty property types, throughout the United States. The firm has offices in San Francisco, Atlanta and Chicago.

SOURCE Stockbridge MORE Communities