Single-lot homebuilding has remained a fragmented segment of residential development, largely led by local operators. Backed by funds managed by Oaktree Capital Management, Thomas James Homes (TJH) has developed a platform that deploys capital across individual homes and multiple markets rather than concentrating it in one large development. TJH operates in California, the Pacific Northwest and Arizona. CEO Steve Schlageter discusses the case for the model, the benefits of lot-level diversification and the role of aging housing stock in the broader supply conversation.
What characteristics make single-lot development attractive to institutional capital compared with larger master-planned communities or build-to-rent projects?
I think there are two primary considerations: risk and return on invested capital.
Large master-planned communities are often developed in secondary and tertiary markets because that’s where builders can find sizable parc
