With the development of 163 Selby Ranch units, ArborCrowd offers individual investors institutional-caliber investment opportunities in the highly sought-after single-family, build-to-let asset class.
Target a net internal rate of return of 18% to 23% over a holding period of two to four years
NEW YORK, February 23, 2022–(BUSINESS WIRE)–ArborCrowd, the first crowdfunding platform launched by a real estate institution, today announced a new offering that allows investors to acquire equity interests in Selby Ranch, a single-family rental (SFR) and construction project for the rental (BTR) located in Colorado Springs, Colorado with a total market capitalization of $61.65 million. The offer allows individuals to invest in the SFR and BTR asset class, one of the fastest growing and most demanded sectors of commercial real estate. Representing around 17% of the overall single-family housing market, the SFR asset class has seen heavy institutional investment, driving competition and creating higher barriers to entry for individual investors.1
AHV Communities (AHV), a leading, vertically integrated developer and operator with extensive experience in the build-to-let asset class, is part of the project’s sponsoring group. ArborCrowd affiliates AHV and MDO Capital, a commercial real estate finance company, collectively funded 30% of the total equity for the transaction. Arbor Commercial Mortgage, a national direct lender and member of The Arbor Family of Companies alongside ArborCrowd, provided a $46.24 million loan to fund construction of the project. ArborCrowd is now seeking to raise $10.79 million from investors for the remaining capital, which an ArborCrowd subsidiary has pre-funded into the transaction. The project is expected to start in 2022 and complete construction in 2024.
The Selby Ranch deal is a particularly attractive investment opportunity due to:
The continued importance and growth of the built-to-let single-family asset class, which saw more than $45 billion in institutional investment in 2021 and national rent growth of 14.7% year-over-year the other ending in October 2021.2.3
Strong sponsorship from AHV, an experienced build-to-let community developer having developed 13 communities containing over 2,200 homes since 2013.
The Arbor family of companies’ unparalleled experience in single family rentals, having launched an asset class specific lending program in 2019.
Alignment of interests between ArborCrowd and investors in the deal’s capital stack, in which a member of its management team is also personally invested.
The booming metropolitan area of Colorado Springs, which has seen population and employment growth far exceeding national rates over the past decade.
“Our expansion into the built-to-let single-family asset class represents an important step in the broader evolution of ArborCrowd by allowing us to offer individual investors coveted access to a highly sought-after type of property,” said co-founder and COO Adam Kaufman. . “By removing barriers to entry to invest in single-family rentals and capitalizing on the incredible demand for these communities across the country – particularly in the secondary and tertiary markets – we are providing investors with the opportunity to generate the returns they are looking for. Additionally, as one of the first institutions with a strong focus on space, our management team is uniquely positioned to evaluate and invest in single-family rental construction projects.”
Mr. Kaufman continued, “Selby Ranch in particular is an ideal project to launch our first investment offering in single-family rental space, as it meets our rigorous underwriting requirements and provides exposure to the burgeoning market of Colorado Springs, which strikes a distinct balance between While factors such as rising house prices, remote work trends, migration to suburban areas, and an aging millennial population continue to drive interest in rentals single-family properties, we expect significant growth for this asset class over the horizon.
When complete, Selby Ranch will consist of 163 three- and four-bedroom units averaging 1,310 square feet. Spanning approximately 13.2 acres, the single-family townhouse-style units will be spread across 47 buildings and will feature attached two-car garages, stainless steel appliances and central air conditioning. Shared facilities offered include a community clubhouse, swimming pool, fitness center and children’s play area.
The Colorado Springs Metropolitan Statistical Area (“Colorado Springs MSA”) is the second largest in Colorado after Denver, with a population expected to reach nearly 770,500 by 2026.4 Its high quality of life, vibrant downtown, affordability and thriving business climate, supported by major employers such as Lockheed Martin, Boeing, Raytheon and L3 Harris Technologies, have contributed to population growth that has doubled the national average from 2010 to 2021.4 Additionally, Colorado Springs offers many highlights for residents, including more than 50 major outdoor attractions and parks, the US Olympic and Paralympic Museum, and Pike’s Peak, one of America’s most prominent mountains.
To learn more about Selby Ranch and access the offering overview and private placement memorandum, which includes market reports, ownership details, risks, financial pro formas and more, please visit https://www.arborcrowd.com/selby-ranch-sfr-community.
ArborCrowd is the first real estate crowdfunding platform launched by a real estate institution, opening up an exclusive network to a new class of investors. As part of the Arbor family of companies, which includes Arbor Realty Trust, a leading publicly traded commercial mortgage real estate investment trust, ArborCrowd is backed by more than 30 years of leadership experience. ArborCrowd reviews more than 500 offers per year from its proprietary network and chooses only those that survive its rigorous underwriting process. ArborCrowd pre-finances the capital of a transaction before launching the offer to investors. This ensures that the deal closes and allows ArborCrowd to provide investors with accurate and detailed information about the property. Additionally, ArborCrowd chooses to present one transaction at a time, so it’s impossible to guess what real estate investors will actually own.
1: United States Census Bureau
2: John Burns Real Estate Consulting
3: Yardi Multifamily National Report, October 2021
4: EASI demographics
See the source version on businesswire.com: https://www.businesswire.com/news/home/20220223005355/en/
Megan Kivlehan – 646-677-1807