Global asset manager Partners Group has acquired a 3,500-home portfolio of single-family rental properties in 17 Sunbelt states for $1 billion. 

Most of the properties are in Texas, Georgia, Alabama and Oklahoma. The portfolio comprises 2,528 recently constructed homes and more than 1,000 homes under construction. Partners did not respond to a request for more information about the geographic breakdown of the portfolio. 

“Millennials are raising families at a time when the high costs of living and a chronic undersupply of housing are making purchasing a home difficult for many,” Partners Group managing director Ron Lamontagne said in a press release. “The provision of affordable rental properties for families that are not ready to buy their first home has therefore never been more important. We were attracted by this investment as it sits within one of our high-conviction themes, residential-for-rent, and helps ease housing-supply constraints.” 

The sellers were affiliates of Fortress Investment Group and Kairos Living, which will manage the properties and oversee the pipeline of homes under construction. Partners Group will provide growth capital to purchase additional homes and invest in the Kairos Living operating platform as the venture grows. 

“A rising number of companies are locating or relocating to the Sunbelt from more expensive and high cost, high tax metro areas,” said Partners Group private real estate Americas executive Scott Egarian. “As a result, the target demographic for the portfolio, which typically includes young families with stable incomes that are looking for more space, is growing. Our vision is to capitalize on the fragmented nature of the single-family rental market to build a platform across the region whilst ensuring superior tenant experiences.”