Builder renovates homes, rents them out

Beazer Homes forms REIT with investment group

At a time when homebuilders are struggling to compete with the bargain-basement prices of distressed properties and more families are turning to rentals as credit stays tight, Beazer Homes USA seems to have adopted the motto, "If you can’t beat ’em, join ’em."

A year ago, Beazer started buying distressed "preowned" homes in its Phoenix and Las Vegas markets, renovating them, and then renting them out to people who might one day be buyers. On Thursday, the Atlanta-based company announced it is putting its 200-single-family-home portfolio into a new real estate investment trust called Beazer Pre-Owned Rental Homes Inc., or BPRH. The trust was formed as a partnership between Beazer and an investor group led and arranged by affiliates of Kohlberg Kravis Roberts and Co.