Pretium and a group of its investors and funds managed by the real estate equity and alternative credit strategies of Ares Management Corporation have completed their acquisition of Front Yard Residential Corporation, a provider of high-quality and affordable single-family rental housing.
The transaction makes Pretium the second-largest owner and operator of SFR properties in the United States, with a portfolio of over 55,000 cash-flowing single-family rentals, the company said. Pretium will manage the venture and partner with Ares to further optimize and expand Front Yard’s portfolio of SFR assets.
“There is significant opportunity in the SFR market and a clear sense of urgency among institutional investors to deploy capital to this asset class given record-high occupancy rates, stable cash-flow characteristics, and potential for continued capital appreciation,” said Pretium Chairman and CEO Don Mullen. “With the Front Yard transaction now complete, we are exceptionally well positioned to further capitalize on a diverse set of SFR investment opportunities.”
RBC Capital Markets LLC served as financial advisor to Pretium. BofA Securities served as financial advisor to Ares. Sidley Austin served as M&A legal counsel, Fried Frank as partnership legal counsel, and Hunton Andrews Kurth as special tax and financing counsel to Pretium. Latham & Watkins served as legal counsel to Ares.