Allianz commits $300m to US residential via Lennar single-family fund

Allianz Real Estate has revealed it committed $300m (€251.2m) of the $1.25bn raised for Lennar’s single-family rental vehicle.

The €71.5bn real estate manager is investing the capital – alongside Centerbridge Partners and several large institutional co-investors – into Upward America Venture, the vehicle which seeks to acquire more than $4bn of new single-family homes.

On Wednesday, US homebuilder Lennar announced the formation of the Upward America Venture with the initial total equity commitment of $1.25bn from the investors, without giving the breakdown of each investor’s contribution. The Upward America Venture is managed by LennarSFR, a newly formed subsidiary of Lennar.

The latest investment expands Allianz Real Estate and Lennar’s relationship. The pair have partnered since 2016 when Allianz was an anchor investor in Lennar’s first venture, Lennar Multifamily Venture I and then in 2019 in Lennar Multifamily Venture II.

Allianz Real Estate said the latest investment into the single-family rental sector forms a diversification play within the US strategy, where the manager intends to deploy $1.3bn in the residential markets over the next few years.

Christoph Donner, CEO of Allianz Real Estate in the US, said: “The Upward America Venture brings the same structure and scale to single-family homes that we have seen develop in multi-family complexes in recent years.

“Partnering with Lennar is an important part of the approach we take to new sectors. Lennar’s development expertise and pipeline and the group’s appreciation of the importance Allianz Real Estate places on sustainable buildings constructed with the health and well being of the community in mind positions us well for a long term relationship.”

Karen Horstmann, head of acquisitions at Allianz Real Estate in the US, said: “The strong demand for single-family homes is led by maturing millennials seeking accommodation for their increasing space needs, with a preference for newly constructed homes and a propensity to rent.

“This trend started some years ago and has only been amplified by the more flexible approach many employers are taking to work from home. This household demographic, which will increase the 35-49 age cohort by almost 20% over the next two decades, will value space and modern housing even more than they have done in the past.”

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