Global real estate firm Hines has entered the build-to-rent market with its initial purchase of the growing asset class as first-time home purchases remain out of reach for a number of Americans, and demand grows for rentals outside traditional apartments, particularly in the Southeast.

Through its Hines U.S. Property Partners fund, the firm’s flagship core-plus offering, the company bought Blu South, a partially completed, build-to-rent development at 920 Blu Central Road in Pineville, North Carolina, just beyond the outer Interstate 485 loop in Charlotte.

The seller was Landmark Properties. Hines declined to disclose the purchase price but said the fund, known as HUSPP, has invested nearly $800 million over the past year across a variety of sectors including retail, medical office and now build-to-rent.

“This strategic acquisition expands our alternatives portfolio, capitalizing on a Class A BTR community that supports long-term demographic tailwinds as people look for more space amid a challenging home buying market,” Adriana de Alcantara, the Hines fund manager, said in a statement.

When finished, Blu South will contain 551 units with a mix of three- and four-bedroom townhouses, along with single-family detached houses and duplexes across the more than 75-acre lot. Of that total, 341 houses have already been completed.

The remaining residences are expected to open to tenants by the third quarter of 2025, according to Hines. Homes will include two-car garages along with more traditional multifamily amenities including on-site leasing and management.

Build-to-rent still remains a small portion of the U.S. single-family housing market, making up just 1.7% or 340,000 rental units, according to brokerage CBRE, but its numbers are growing. Since 2019, build-to-rent completions surged 270%, according to the National Rental Home Council trade group.

A new study from Arbor Realty Trust found 75,000 build-to-rent units began construction in 2023, an all-time high. That number was an increase of nearly 9% from 2022 and accounted for roughly 8% of all single-family construction. By comparison, build-to-rent’s share of single-family construction never topped 3.1% before the 2007-2009 recession.

Most of the new construction has been in the Sun Belt, according to NRHC. That aligns with findings from Arbor showing the greatest demand for rental homes has been in the region. Among the top ten metropolitan areas for Google searches for “homes for rent,” all came from Tennessee, Georgia, Alabama, and the Carolinas where Arbor says population growth and more affordable housing costs have propped up demand for the asset class.

In Blu South, Hines found an opportunity to reestablish its presence in the Charlotte market, according to Paul Zarin, the company’s managing director, propelled by “secular tailwinds that make it a compelling market for investment” including increasing mortgage rates that drove the S&P CoreLogic Case-Shiller National Home Price Index up 50% since the COVID-19 pandemic.

“Blu South offers optionality for Charlotte residents seeking exceptional housing that is attainably priced and conveniently located,” Zarin said in a statement. “It is rare to find a build-to-rent community that is adjacent to transit and centrally located among the city’s major employment nodes.”

But not everyone has had such a rosy view of Blu South’s position in the Charlotte market. The property has come under criticism after appearing in the Netflix show “Love Is Blind” for its suburban, cookie-cutter look and for being less dense than traditional multifamily developments, requiring residents to rely on cars, according to media reports.

Brent Toderian, Vancouver’s former chief city planner, called Blu South “the most modest approach to density you could imagine in a suburb,” according to Business Insider. “You’re still doing car-dependent urban sprawl, you’re just doing it slightly better. But you’re still doing the wrong thing,” he told the outlet.

Others, including Yongqiang Chu, a professor of real estate and urban economics at the University of North Carolina, Charlotte, said “anything that can help developers to develop cheaper alternatives to single-family houses, I think, is a good thing,” adding that cost savings was the greatest benefit of dense construction.

Representatives from Hines were not immediately available to comment on the criticism. The company did, however, note in a statement that the property provides walkable access to Charlotte’s light rail system at the I-485/South Boulevard station along the city’s Lynx light rail system’s Blue Line.

Hines’ HUSPP fund is an open-ended diversified fund targeting next-generation assets in markets throughout the United States, the company said. It expects the fund to continue to invest across residential, industrial, office and mixed-use sectors. Hines currently manages a portfolio valued $93.2 billion and serves residents at more than 850 properties.