Seattle-based real estate investing platform Arrived Homes has gained $100 million in credit financing from Certain Lending, a mortgage technology company also headquartered in Seattle.
Arrived co-founder and CEO Ryan Frazier said the money will go toward inventory, as the startup's business hinges on buying single-family rental homes in which individual investors can buy shares.
"Residential real estate is a very standardized product, highly marketable and resellable. It's very lend-worthy," Frazier said. "We can tap into that in a cost-effective way. Basically, it's really about building inventory so that we can meet the demand that we have."
According to the company, Arrived has $20 million worth of rental properties across 11 metropolitan areas. Frazier said the company aims to be in 30 to 50 metros by the end of next year. Arrived is currently looking to buy single-family rentals in Texas, Florida and Washington, and Frazier said the company aims to have rentals available in all three states in the first quarter of 2022. Frazier said Arrived is already submitting offers in the Seattle area.
Arrived is also looking to get into short-term rentals made popular by Airbnb. Even though that model has different challenges, such as faster turnovers and seasonal cash flow, Frazier said it's an exciting asset class.
"It's something we've been working on for a while now," Frazier said.
According to Arrived, which was founded in 2019, the company has fully invested properties in Arkansas, Arizona, Colorado, Georgia, North Carolina and South Carolina. Consumers can invest between $100 to $20,000 per house, the goal being to collect rental income and see property value grow. Arrived raised $37 million in June, including $10 million in equity financing and $27 million in debt financing.
Frazier said Arrived currently has just over 20 employees, most of whom are based in the Seattle area, and the startup will likely hit between 30 and 35 by the middle of 2022. The company has been working remotely but has a WeWork space in South Lake Union and gets together quarterly for all-team off-sites, mostly to talk about long-term strategies or just to spend time together in person.
