July 9, 2012

By Blaine Rollins, CFA, Managing Director, 361 Capital

So yield hungry investors will now be helping the residential real estate market...Beazer Homes USA Inc., one of the nation's top home builders, has formed a REIT that will buy and then rent single-family homes, one of the largest and most talked-about asset classes in the real-estate business. The Atlanta-based company last week announced that it was joining with buyout firm Kohlberg Kravis Roberts & Co. to form the REIT, which eventually plans to go public. Beazer already had accumulated 192 single-family homes in the Phoenix and Las Vegas areas–more than 10.0% of those houses the company built and sold in the first place. Most were purchased at steep discounts from their original prices through foreclosure auctions, short-sales or other distressed home-buying strategies.

Source: This was excerpted from Wall Street Journal via 361 Capital's 361 Capital Weekly Research Briefing, May 14, 2012 publication, http://361capital.com.

COPYRIGHT 2012 361 CAPITAL LLC

REPRINTED WITH PERMISSION FROM 361 CAPITAL LLC