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Expecting a rebound, Alaska Permanent Fund to invest in foreclosures

Katie Medred
istockphoto

The Alaska Permanent Fund Corporation (APFC) is eyeing troubled real estate markets to boost its portfolio. The $40-billion-dollar fund plans to make an initial investment of $400 million in the company American Homes 4 Rent LLC. 

The fund’s board of trustees is looking at investing in depressed housing markets across the nation. Their plan is to invest through the property management firm American Homes 4 Rent LLC, which owns around 1,000 single-family homes and will scoop up foreclosed properties. The Permanent Fund will not own any homes directly. Instead, the homes will be managed as rentals and sold for a profit when the market improves.

The board of trustees has given conceptual approval to the plan  but has yet to finalize the details. The board’s chair and the president of Ketchikan’s First Bank, Bill Moran, told the Juneau Empire,  “When we created the allocation to special opportunities, the purpose was to create room within the fund where we could take advantage of unexpected investment opportunities such as the single-family-homes strategy.”

Moran sees the acquisition of property as a unique opportunity for the fund and expects it to take as long as two years to make the initial purchases – and five to seven years before selling properties.