Homz, a Frisco-based startup that says it’s the first national housing company to develop “wellness-centric” multifamily communities, announced Wednesday that it has raised $50 million in pre-seed funding.
The round was led by Nanban Ventures, a Dallas-based venture capital firm investing in startups across the U.S. and India that are committed to making a positive impact on society. Additional contributions were made by family offices, high-net-worth individuals, and ultra-high-net-worth individuals, Homz said.
“It’s no secret that there is a lack of attainably priced housing in the U.S., which severely restricts optionality and socioeconomic advancement,” Homz board member Kim Diamond said in a statement. “We’re committed to changing this by delivering a uniformed brand of sustainable, wellness-centric communities at attractive price points that people actually want—and can be proud—to live in.”
Homz—which we told you about when it launched last July—said it plans to use the funding to advance its efforts to form partnerships with cities across the Southeast and fund the development of its communities in those markets.
Aiming to offer wellness-focused housing in sustainable communities
24 by Homz is designed for value-conscious residents. [Rendering: Homz]
Diamond said the funding “illustrates the value institutions see in our business model and its potential to be an important solution that addresses the universal funding challenges prohibiting the development of attainable housing communities throughout the country. We look forward to using the proceeds to accelerate the progress we’re making and fund market research in the cities we have identified as strategic fits for our product.”
Homz said it aims to address the shortage of attainable housing units available for rent in the United State by creating a portfolio of sustainable, wellness-focused communities that feature the same design, layout, and amenities.
The company said the idea to create a single, uniformed concept and apply it to housing was derived from the hospitality industry—to which Homz’s founders have deep ties, possessing decades of experience developing, owning, and managing more than $5 billion worth of assets.
‘Significant opportunity’ in Texas and beyond
After its launch last year, a company spokesperson said Homz sees “significant opportunity” in states such as Texas, Alabama, North Carolina, Colorado, New Mexico, and Utah.
The company said it has 15 to 18 initial agreements for developments currently pending.
Homz wants to develop 50 communities over the next five years. It targets tier-2 markets that are located within a roughly 20-to-30-minute drive from major high-growth Metropolitan Statistical Areas (MSAs).
Homz said it wants to engage with city officials from municipalities that fit this criteria and are interested in providing incentives that make it possible to develop these communities.
Using its mixed-use master planned communities, Homz seeks to preserve or increase socioeconomic diversity while providing public access to vibrant, highly-amenitized urban environments.
All of its communities will feature 54 publicly available amenities, including clubhouses, pools, athletic fields, playgrounds, urban farms, Miyawaki forests, and more, that are designed to foster deeper senses of wellness and satisfaction among residents and their neighbors.
Providing a variety housing to appeal to renters at different life stages
Rendering of entrance to a Homz community. [Image: Homz]
Each community will feature four multifamily brands—UP, 24, NJOY and LYF—that are designed to meet renters at each stage of their lives, along with a selection of build-to-rent single-family homes.
UP and 24 target value seekers, while NJOY and LYF offer larger floorplans to accommodate roommates and growing families, Homz said.
“What really stood out to us about Homz was its commitment to address the lack of attainable housing supply in the country in a way that not only reduces costs—which it does through city partnerships and standardization across communities—but also by creating communities that prioritize the health, safety and wellness of people and the environment,” Gopala Krishnan, CEO and managing partner of Nanban Ventures, said in a statement.
“Investing in Homz provides us with an opportunity to contribute to the betterment of society and the livelihoods of many individuals and families without limiting our return potential,” Krishnan added. “We’re excited to see these communities come to life.”
Homz said it anticipates investing between $140 million and $170 million in each community and will secure financing from the Department of Housing and Urban Development.
The company will hold each investment for roughly 25 years, creating a close alignment of interests with each city.
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Over the next five years, Homz wants to break ground on 50 communities across the country. The mixed-use projects would include build-to-rent single-family homes and four multifamily brands that are designed to meet the needs of renters at "each stage of their lives." The company's leaders say they're focused on a triple bottom line approach to building sustainable, attainable housing communities.
