Amherst Holdings has landed a significant partnership with the real estate division of Koch Industries. This merger comes as good news for Amherst, as they had previously called off a $2.3 billion deal, which would have allowed them to acquire a single-family rental landlord.
Founder of Koch Real Estate Investments, Charles Koch made a $200 million preferred equity in the Single-Family rental business, Amherst. According to Bloomberg sources, this multi-million-dollar deal was a year in the making and finalized earlier this month.
Amherst Fails to Acquire Rival Front Yard
Before the Koch and Amherst venture, Amherst had plans to acquire their rival, Front Yard. Rather than pursue the deal, it was terminated to the tune of $25 million. The original plan was to buy $55 million in Front Yard shares while providing a $20 million unsecured loan.
Thanks to the new acquisition, the Koch investment is going to boost Amherst’s buying capacity by nearly $2 billion (80% loan to value ratio). Presently the Austin based firm boasts a portfolio featuring over 22,000 homes.
The new venture between Koch and Amherst may be a win-win, as renovations and developments can rely on Koch’s in-house consumer and building departments.
Things are looking up for Koch as their real estate department also recently provided $206.4 million in secured financing to REIT Ladder Capital.