Gary Beasley, co-CEO of Starwood Waypoint Residential Trust (NYSE: SWAY), joined REIT.com for a CEO Spotlight video interview at REITWorld 2014: NAREIT’s Annual Convention for All Things REIT at the Atlanta Marriott Marquis.
Based in Oakland, Calif., Starwood Waypoint acquires, renovates, leases, maintains and manages single-family homes. Beasley discussed the importance of creating a strong brand for the company.
“Building a brand is setting expectations in the consumer’s mind and then delivering on it,” Beasley said. “The good news is that the bar is pretty low because in our space it hasn’t been professionally managed up until fairly recently.”
Beasley said his background in the hotel industry fostered his appreciation of brands. In Starwood Waypoint’s case, “we need to deliver a quality product, offer great service and really back it up,” he said.
Meanwhile, Beasley offered his thoughts on how the investment community has reacted to the emergence of the single-family rental sector.
Beasley stressed that it will likely take several quarters of data from a number of single-family rental companies and ongoing discussion about the dynamics of the business before the market can “understand and embrace the sector.”
Beasley also discussed how Starwood Waypoint determines which markets it wants to invest in.
He explained that the company is currently active in about a dozen markets. In choosing where to invest, Starwood Waypoint utilizes an algorithm that assigns a score to a neighborhood based on factors including crime statistics, school performance and job growth. The algorithm also determines the level of yield the company can expect on its properties in that market.
“We want to get the right yields, we want to be in areas that are growing and we also want to be in markets where we can get operational scale,” Beasley said. He added that Starwood Waypoint usually seeks to purchase at least 500 homes in each market and, ideally, up to 1,000 homes.