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An investment platform for rental property Picket has closed a Series B round of financing in the amount of $20 million, expanding the presence of firms capitalizing on the nation’s shift toward long-term leasing.
With a focus on the single-family rental (SFR) category, Picket calls itself a “provider of integrated technology and services for residential real estate investing, management and resident experience.” Leading the round was LL Funds; and participating was RET Ventures which led its Series A in 2022, according to a Jan. 20 announcement sent to Inman.
Quinten “Q” Shay, co-founder and CEO of Picket, said its mission to assist SFR investors at all levels has helped it grow significantly in the last 18 months.
“We’re thrilled to be able to offer investors access to advanced data, analysis and tools that simplify and streamline the real estate investing process, and we look forward to significantly expanding our reach in the months and years ahead,“ Shay said.
The company offers an array of digital tools, accessible through a web app, that assist investors in discovering, performing due diligence and acting on notable property opportunities. Last year saw the company facilitate $270 million in SFR investments, namely in the institutional category, meaning larger monetary sources and companies buying on behalf of accredited clients, such as pension funds and Wall Street entities, Picket said in the announcement.
However, as part of the funding round, Picket plans to extend its services to those in the retail investor space, namely as a result of its dashboard functionality and transparent use of rich-market data.
Picket is a full-service brokerage and property management firm, as well as a portfolio performance adviser, thus blending elements of fintech. It is heavily focused on tenant services and localized services once leases are signed, including an array of digital features for lease oversight, expense tracking and per-unit oversight, according to its website.
The company’s acquisition services help clients “identify qualified assets faster with automated valuation models built from multiple local data sources,” and it does this based on the investment tactics of the user, Picket’s website explains. For example, some investors are comfortable with higher-priced, less-maintenance-heavy properties while others look to stockpile lower-cost homes more likely to produce notable monthly cash flows. It automates offer submission and management, speeds underwriting and feeds users homes published on local multiple listing services.
“Properties are ranked according to investor criteria, and each on-demand investment analysis includes rental and sale valuations, modeled expenses and returns, and neighborhood-level data (including school scores, crime rates, population growth, and income growth),” the announcement reads.
Technology to support the single-family rental market is having a moment, largely thanks to the stalled sales environment and recognition that SFR communities are a massive, mostly untapped asset class.
Technology company Avenue One, which describes itself as a marketplace for institutional owners, buyers and sellers of residential homes, raised $100 million in May of this year, in another sign of the space’s expanding presence. The company was founded in 2021 focusing on mid-tier market homes that often require renovation, for which Avenue One hires local vendors to facilitate.
Bolstering the category’s presence, like all trends, is Wall Street’s wide-eyed interest.
A February 2023 CNBC report cited a MetLife Investment Management study finding that institutional investors may control 40 percent of U.S. single-family rental homes by 2030.
“We have seen persistent enthusiasm for residential real estate investing throughout the market cycle — especially in the single-family sector,” said Shay in the announcement. “By offering sophisticated, flexible, and affordable solutions across the entire investment lifecycle, we believe we can help more investors confidently buy and manage rental homes and help more residents realize the exceptional benefits of living in them.
“We will not be satisfied until we have fundamentally transformed the experience of both.”