Take a longstanding housing shortage, mix in the many advantages of renting and spike it with a pandemic that has expanded the spatial boundaries of millions of people, and you get the burgeoning single-family rental (SFR) residential market. Inland Real Estate Acquisitions has found so much favor in the sector that it’s purchased approximately $2 billion in SFR assets across the country on behalf of Inland affiliate companies. GlobeSt.com reached out to Mark Cosenza, senior vice president of Inland Acquisitions, to discuss the sector’s many advantages and the company’s aggressive growth strategy.
“The single-family rental sector is so hot, it’s incredible,” Cosenza said. “The product is expanding everywhere, it’s really taking off. I don’t think there’s a spot in the country where it doesn’t have appeal. Residents get the single-family residence without the maintenance aspect.”
Being a newer niche market, there were fresh SFR factors that Inland had to study up on and grow into. Cosenza’s first residential acquisition in Phoenix was “a different play than we were used to doing.” Rather than having predominantly Empty Nesters throughout the property, Cosenza and his team found that the demographic profile on site offered strong balance with residents ranging from retirees and Empty Nesters to Millennials and young professionals.
“Being able to understand that range, an even mix throughout, signals that SFRs are providing residential options to all of these renter bases,” Cosenza said. “That’s when we realized this sector really has some legs because it’s not just playing to one renter type. The renters are the one that are really telling us that this SFR strategy is a winner.”
All of Inland’s SFR assets are gated developments. Residents also enjoy the privacy of their own entryways and backyards. The properties are highly amenitized, but, of course, low, or rather no, maintenance.
“It really provides a community to them,” Cosenza said. “Great common areas reinforce that feeling. Residents are able to enjoy outdoor events like barbeques and more. And you don’t see backyards in midrise or garden-style apartment communities, so there’s that great balance of community offerings and abundant personal space.”
Cosenza calls the SFR sector “city agnostic,” meaning the niche product is so popular it borders on ubiquitous. After entering the SFR sector in Phoenix, where Inland’s 10 assets span the entire MSA, Inland Acquisitions has purchased product from Texas to Minnesota to the Southeast and Florida. That includes build-to-rent product, cottage-style rentals and entire communities.
“The occupancies are extremely high in these assets as are retention ratios,” Cosenza added. “With people doing more and more hybrid work, i.e., two to three days working from home, these rental units are more appealing for flex work than apartments. I can’t say enough about SFR; it’s a fun asset class to own and invest in.”