Global property investment firm Round Hill Capital has established a joint venture with real estate management company SFO Capital to develop family homes to rent.
The newly formed partnership said it is set to complete two major deals shortly in Dublin and intends to build on these over the coming years to expand its housing strategy across the Republic.
"The venture will have the ability to operate swiftly and effectively to secure high-quality single family rental (SFR) investments, providing much-needed new homes to address the long-standing supply / demand imbalance that continues to prevail in the Irish residential market," said Michael Bickford, founder and chief executive of Round Hill Capital.
Single-family homes for rental are the most common form of housing in the US and in many other markets but make up only a small fraction of the housing market locally.
Investor interest in the segment has been increasing recently in part due to the Covid crisis. Institutional investment totalled about $4.7 billion in the US in 2020, according to CBRE.
Round Hill and SFO said they would use their combined expertise to target high-quality deals that would bring new homes quikcly to the Irish market.
Mohamad Abouchalbak, chief executive at SFO Capital, said the initial focus is on Dublin, because it is "a city with robust macroeconomic fundamentals, dynamic demographics, and a clear growth outlook".
“We particularly like Dublin given its critical need for institutional quality residential stock that can cater to a rapidly growing and highly skilled workforce. Our conviction was reinforced by the resilience of the city during the Covid-19 pandemic,” he said.
Round Hill Capital opened an office in Dublin in August 2019, saying it had more than €1 billion of capital to deploy in the Republic. Founded in 2002 and with over 200 employees across 14 offices globally, the firm manages over 110,000 units .
London-based SFO has a portfolio comprising more than $1.4 billion in assets, including 5,600 apartments and more than seven million sq ft of commercial real estate under management.