January 07, 2021
Brett Forman, Trez Capital, addresses Single-Family BTR challenges.
Challenges also can be found in terms of zoning and entitlement, and the NIMBYism that’s encountered in trying to push any development through in some communities, where there can often be more pushback against rental homes than those that are built for sale. “Sometimes, developers get cute and try to tell the municipality they’re building townhomes with individual tax IDs, but then choose to rent them,” says Brett Forman, executive managing director in the Palm Beach, Florida, office of private commercial mortgage lender Trez Capital, which has underwritten several BTR projects. “And when a lender such as ourselves goes to seek a zoning opinion from the municipality that they don’t mind that it’s a rental, all of a sudden the local board says, ‘Wait a minute, we didn’t think you were going to rent product, we thought you were going to sell.’ At that point, you’ve got three sides to the story.”