Florida-based private equity firm Transcendent Investments Management (TIM) is partnering with brokers around the country to purchase bank-owned single-family properties as part of a new investment fund it’s raising.

The fund, which launched its capitalization campaign last year, will be the firm’s second distressed property-focused fund and is looking to raise $250 million, said Jordan Kavana, TIM’s director. The first fund, implemented in 2008 with a two-phase capitalization of $100 million, was involved with Freddie Mac’s HomeSteps program, he said.

The original fund invested in about 1,000 real estate owned (REO) properties that had been foreclosed on and repossessed by lenders, and either fixed and flipped them or converted them to rentals in markets across the country, including Miami; Atlanta; Boulder, Colo.; Las Vegas; and Southern California, among other areas.

About 90 percent of the homes in the first fund were developed as rentals, Kavana said. In 2011, TIM focused investment in the fund solely on rentals after determining that price points had reached a profitable enough level, making returns targeted at 15 to 20 percent a viable goal, he said.

All of the properties in the second fund will be developed as rentals and held for a period of at least five years, Kavana said. The second fund will participate in the Federal Housing Finance Agency (which oversees Fannie Mae and Freddie Mac) initiative, announced in February, that facilitates the purchase of pools of bank-owned properties for conversion into rentals by investors.

TIM maintains a national network of registered brokers it partners with in purchasing REO homes, Kavana said. The company rates the brokers and works with those who are responsive and facilitate purchases smoothly, he said.

Other investors are looking at the REO-to-rental opportunity. In Oakland, Calif., a public-private investment partnership has plans to invest in 100 REO homes in struggling neighborhoods this fall and convert them to rentals.

Show Comments Hide Comments


Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
Thank you for subscribing to Morning Headlines.
Back to top
Real estate news and analysis that gives you the inside track. Subscribe to Inman Select for 50% off.SUBSCRIBE NOW×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription