London-based real estate investment management firm Pure Global Capital has launched its latest business platform, U.S. Single-Family Rental Homes, in a joint venture agreement with Twin Summits Capital.

The fund is PGC’s first move into the U.S. market, following the firm’s launch in late 2016. Twin Summits Capital, an independent investment manager based in the United Kingdom and United States, will manage the fund.

The new fund aims to raise $200 million in equity commitments in the first round from approved investors. The fund will invest across the United States and also provide bespoke separately managed account services.

This move by PGC and Twin Summits Capital comes in the context of declining home ownership levels in the United States during the last 20 years, coupled with increasing demand for suitable rental accommodation significantly outstripping supply by more than 10 percent. This has led to substantial upward pressure in rental levels, which is set to continue, potentially for the next five years.

The fund will seek to capitalize on this trend by investing in research-led and targeted cities benefitting from strong capital appreciation and high rental demand, with the aim of delivering a 9 percent unleveraged return and distributing a circa 5 percent annual coupon.

“U.S. homeownership levels have been in persistent decline, and with strong tenant demand and restricted supply due to a low pipeline of available stock, we consider that it is an excellent time to invest in the market,” says Jeff Morton, head of investment management and founder of PGC.

PGC launched in November 2016 with a $100 million investment proposition in the U.K. student-housing sector and has an opportunistic investing approach. PGC operates across the entire capital structure, investing in physical real estate assets, stretch senior debt and in equity of corporate entities as well.