Rental-Backed Security Bonds to be Offered by Blackstone

Rental-Backed Security Bonds to be Offered by Blackstone (CNBC)

Mortgage-backed securities are dead. Long live rental-backed securities! Blackstone, the largest investor in single-family rental homes, will offer a security backed by those homes through JPMorgan, Deutsche Bank and Credit Suisse. “Noting the lack of performance data, Fitch expects to place a strong emphasis on reliable data obtained from independent sources for determining rental prices, vacancy rates, supply and demand data and other pricing fundamentals. Even so, the lack of historical data and ambitious growth strategies by regional operators will make high investment-grade ratings on these transactions difficult to attain,” said Suzanne Mistretta, senior director at Fitch Ratings.

What do you think? Are rental-backed securities ultimately going to be more profitable than mortgage-backed securities? Talk back below.

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