Arrived, a company backed by Jeff Bezos, has attracted almost half a million retail investors since its launch in 2021
Many of the world’s largest investment firms have launched new funds over the past couple of years aimed at acquiring or building single-family homes to use as rentals. This comes as no surprise considering that the increased cost of buying a home has forced many Americans into being tenants instead of homeowners.
Arrived, a young real estate company backed by Amazon.com Inc. founder Jeff Bezos, has just announced its entry into the single-family rental fund space. Arrived currently operates a fractional real estate investing platform that has attracted nearly half a million retail investors since its launch in 2021. The platform allows these investors to purchase shares of single-family rental properties with as little as $100.
To date, investors on the platform have funded more than 388 homes with a total value of over $122 million. Properties are often fully funded within hours of going live, which has resulted in Arrived limiting the maximum investment on many of its offerings.
The new Arrived Single Family Residential Fund aims to simplify capital allocation by allowing users to invest more at one time and invest on their own schedule without having to wait for individual properties to launch. Investors in the new fund will be diversified across several properties in multiple real estate markets. Arrived also intends to give investors an option to redeem or liquidate their shares on a quarterly basis after the first six months.
Arrived CEO Ryan Frazier expressed optimism about the single-family home market, citing its historically robust returns and lower volatility compared to the stock market. He also noted the persistent demand for housing, outpacing the supply of new homes over the last decade.
In the third quarter of 2023, investors on the platform earned approximately $890,000 in dividend income, marking an increase from the previous quarter. Over the past year, the platform has disbursed over $2.8 million in dividends to its investors. The introduction of the new fund does not signal the end of Arrived’s traditional model. Investors can still purchase individual property shares with the same $100 minimum investment.
Arrived was the first SEC-qualified real estate investing platform to allow virtually anyone to buy shares in single-family rental properties. This innovative approach to real estate investing has attracted significant attention and backing from high-profile investors and tech entrepreneurs, including Jeff Bezos, Marc Benioff, Spencer Rascoff, and Dara Khosrowshahi, who all invested in the company’s seed round. Bezos’s continued support was evident with his second investment during Arrived’s $25 million Series A funding round in 2022.