Renters Warehouse, one of the biggest managers of rental houses in the country and a well-known TV advertiser, has been sold to a group of local investors with plans to make it even bigger.
Northern Pacific Group, which focuses on technology and service companies, says it will invest significant resources to expand the Twin Cities-based company tenfold.
"The company has proven out its business model and is poised for tremendous growth," said Scott Honour, Northern Pacific's managing partner. "We are bringing capital and know-how to the company that will help it accelerate its growth."
Terms of the deal were not disclosed.
The deal comes at a time of increasing competition for companies that specialize in renting and managing single-family houses — a sector of the property management industry that barely existed more than a decade ago but grew to accommodate a tsunami of accidental landlords who couldn't sell their homes after house values plummeted.
The industry is now dominated by national real estate investment trusts that own and manage thousands of single-family houses — most of them former foreclosures — that are scattered across the country. There are also hundreds of much smaller companies, including many that were started by former real estate agents who saw an opportunity to manage their clients' unsold homes.
Brenton Hayden hopped into the trend early and quickly. He founded Renters Warehouse on the cusp of the housing crash in 2007 and later took on investors to help develop a franchise operation. The company grew swiftly, landing a spot on Inc. Magazine's list of fastest growing privately held companies in America.
By the end of 2012 the company had offices in Arizona, Colorado, Maryland, Tennessee and Georgia and more than 2,000 properties under management. It now has about 10,000 homes under management.