Invitation Homes Acquires ResiBuilt to Expand In-House Development

Invitation Homes INVH recently announced the acquisition of Resibuilt Homes, a leading built-to-rent (BTR) developer in the high-growth Southeastern markets. The acquisition will aid INVH in building on its development capabilities with more efficiency and cost control to meet the growing demand for affordable, high-quality housing. The company acquired Resibuilt for a contract price of $89 million and up to $7.5 million in potential incentive-based earn-out payments linked to third-party fee-build performance.

Resibuilt, with its headquarters in Atlanta, has been developing single-family communities in Georgia, Florida and the Carolinas, with more than 4,200 homes delivered since its inception in 2018. The company has expertise in developing quality construction with a resident-focused approach.

The above transaction comprised 23 existing fee-building contracts, along with a pipeline of additional third-party fee opportunities not yet under contract. In addition, though no land was included in the transaction, INVH has an option to acquire around 1,500 well-located lots for future purchases. As such, the acquisition is expected to be immediately value accretive with modest contribution to the company’s 2026 AFFO per share.

Post Resibuilt’s divestiture, its parent company, RESICAP, will continue its independent operations and will be restricted from competing with it in the ground-up BTR construction.

Wrapping Up on INVH

Invitation Homes operates on an asset-light model by building relationships for BTR units with top homebuilders like D.R. Horton, Lennar, Pulte, Meritage and many others who develop homes and deliver to the company. The company aims to drive profitability with the value-added platform and minimal capital investment.

The above acquisition will enhance INVH’s ability to deliver homes that align with its operating standards, potentially improving leasing activity and long-term tenant retention. Moreover, the deal positions INVH to deepen its presence in fast-growing Sun Belt markets, reduce reliance on external developers and create a more durable, vertically integrated growth platform.

However, the elevated supply of rental units in some of Invitation Homes’ markets and competition from alternative housing options are likely to weigh on pricing power. High interest expenses add to its woes.

Over the past three months, shares of this Zacks Rank #3 (Hold) residential REIT have declined 3.3% compared with the industry’s fall of 0.5%.

Stocks to Consider

Some better-ranked stocks from the broader REIT sector are Prologis Inc. PLD and Host Hotels & Resorts HST, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for PLD’s 2025 and 2026 FFO per share is pinned at $5.80 and $6.08, respectively. This calls for year-over-year growth of 4.3% for 2025 and 4.7% for 2026.

The Zacks Consensus Estimate for HST’s 2025 and 2026 FFO per share is pegged at $2.05 and $2.04, respectively. This implies year-over-year growth of 4.1% for 2025 and a marginal fall for 2026.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.

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This article originally published on Zacks Investment Research (zacks.com).

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