Last Updated on May 12, 2022
A pair of Goldman Sachs-backed rental funds snatched up an entire Florida community for the price of $45 million, according to reports from NBC 2 Orlando. Fundrise Interval Fund and Growth eREIT VII purchased 87 single-family properties in Brevard County as part of an ongoing expansion.
Fundrise previously snatched up a 120-unit development in Pensacola and has been purchasing developments in states like Mississippi and South Carolina, according to The New York Post.
Wall Street’s increasing interest in the south mirrors nationwide population trends. New York saw the largest population decline in 2021 while Florida has been growing rapidly. This has led to decreased housing availability and soaring prices for both renters and potential homeowners.
Faith-based organizations working towards providing affordable housing expressed some level of concern with local media outlets. “Investors come in and of course invest. Property just goes off the roof,” Bishop Merton L. Clark of Truth Revealed International Ministries told NBC 2. “Which marginalizes a whole lot of people who just can’t afford it. Especially those in Brevard County who make less than $46,000 a year.”
Dr. Lawrence Yun, a Chief Economist of the National Associate of Realtors, said Wall Street is looking to capitalize on surging rent prices in a “fairly new” move.
“The degree of large Wall Street money coming in fairly new. I think this is due to the unique circumstance of housing shortage,” Yun said. “Wall Street is able to generate money, private equity, hedge funds and others to say let’s go chase the rising rents and putting money into rental property development.”
The Goldman Sachs-backed firms now own all 87 properties in Florida’s Cypress Bay Community. The trend is expected to continue as housing costs surge.