Taylor Morrison Locks Down $3 Billion for BTR Expansion

Taylor Morrison has entered into a financing agreement with Kennedy Lewis Investment Management, securing $3 billion in capacity to accelerate the growth of its build-to-rent (BTR) brand, Yardly, the companies announced.

The agreement with Kennedy Lewis, which manages approximately $30 billion in assets, will fund both existing Yardly communities and new land opportunities. The investment enables Taylor Morrison to expand its rental operations, meeting the high demand from consumers who are renting due to affordability challenges in home ownership.

“This strategic financial facility agreement dedicated to our build-for-rent business will help to scale our existing core competencies of land acquisition, land development and efficient home construction,” said Sheryl Palmer, Taylor Morrison’s chairman and CEO. “Ultimately, our hope is for Yardly renters to become future Taylor Morrison homeowners.”

The financing arrangement builds on an existing relationship between the companies, which already have a land banking agreement supporting Taylor Morrison’s for-sale operations.

Addressing Market Dynamics

The facility comes as builders increasingly look to rental housing to maintain construction volume while homebuying remains constrained. Build-to-rent communities allow developers to retain ownership of properties while generating steady rental income.

“This transaction demonstrates another use case for land banking as a capital solution to meet the diverse needs of our homebuilder counterparties as they seek creative ways to address today’s affordability challenges,” said Darren Richman, managing partner of Kennedy Lewis and CEO of Millrose Properties.

For Taylor Morrison, the financing provides balance sheet relief and gives the company more options as it evaluates potential asset sales over time. The arrangement adds to the builder’s existing land strategies, which include joint ventures, seller financing, and deferred participation payments.

Yardly Brand Focus

The Yardly brand aims to offer a higher-end rental experience than typical apartments, with single-family homes that include private backyards and community amenities. The company puts a special focus on pet-friendly features to appeal to a large segment of the rental market.

This new financing provides Taylor Morrison the flexibility to grow the Yardly brand efficiently while making strategic decisions about the portfolio’s future.