Boost for Foreclosure Market; Real-Estate Firm Gets Citigroup Loan to Buy Properties to Turn Into Rentals
Waypoint Real Estate Group LLC, a major investor in U.S. foreclosed homes, has secured a $65 million loan from Citigroup Inc. to help add to its portfolio of properties, according to people familiar with the matter.</br></br>Bankers and investors said the debt-financing deal is a milestone for the burgeoning business of renting out houses that were previously in foreclosure.</br></br>Waypoint, an Oakland, Calif., investment firm, is working with Citigroup on a bigger, longer-term financing deal that is expected to close in the coming weeks, the people said.</br></br>Investors have spent billions of dollars in recent months snapping up foreclosed homes, betting they will profit from the rental income the properties produce.</br></br>The strategy gained momentum earlier this year, after the Federal Reserve expressed support for the strategy as a way to clear the backlog of foreclosures that has slowed the U.S. housing market's recovery.