With a degree in political science and a deep and multifaceted background in development, market analysis, and finance, Cisterna decided his way forward from Toll Brothers would be unconventional. “I got laid off on Friday and started my consulting firm, American Pacific, on a Monday,” he said. Over the next few years, American Pacific consulted with dozens of the biggest financial industry players, including several of the largest banks in the country, about how to manage their swelling book of foreclosed homes, commercial properties, and large tracts of land. On the other side of the coin,
Cisterna also advised large private equity firms and hedge funds how to capitalize on the distress in the market. After nearly five years, he was recruited to run the west coast office of the Carlton Group, a well-known New York-based real estate investment banking firm with a penchant for mega-deals. “I had companies coming to me to determine the feasibility of buying thousands of houses at a time. They also needed to raise equity or debt to execute that strategy, and in the SFR investment space alone I facilitated and consulted on the deployment of about $250 million in the span of about nine
months,” he recalled. Total institutional investment in SFR homes is estimated today at about $33 billion, but at the time, $250 million was unprecedented. “I thought to myself, ‘Wow, this is really about to take off,’” Cisterna said. “People were buying properties below replacement cost and the big investment firms were figuring out how to operate these investments. It was going to turn into something more like multifamily than we had seen on the SFR side of things previously. I knew I had to be a part of that transition or I was going to end up a well-educated advisor that was not necessarily special or unique in what I was offering the real estate sector. I
SINGLE-FAMILY RESIDENTIAL (SFR): A designation used to describe real estate used for living space by a single household. TERM FINANCING: A loan with a specific repayment schedule and a fixed or floating interest rate. INSTITUTIONAL REAL ESTATE INVESTOR: A large organization that makes substantial investments in real estate- based assets.
WHEN DENNIS CISTERNA, CEO of Investability Solutions, joined the Altisource Portfolio Solutions offshoot's “one-stop shop” for single-family residential (SFR) investors, he did so with a clear mission in mind. “It should not be difficult to acquire, finance, manage, and structure partnerships in real estate,” Cisterna said. “There is a place in every asset class for small investors and big investors, and it is the responsibility of the industry giants to be a catalyst for positive change.” Cisterna's mission aligns perfectly with the Altisource family of companies stated goal of “providing services and technology for the mortgage and
real estate industries” while keeping “innovation as a guiding principle. The move also suited Cisterna perfectly, since he had maintained a bead on the single- family residential (SFR) rental industry since shortly after the housing crash. “Before the crash, I was running acquisitions for Toll Brothers in Southern California,” he recalled, adding that his division went from 160 employees to 16 during the foreclosure crisis. Cisterna knew it was only a matter of time before his position was eliminated as well. “Homebuilding and land acquisitions were the last things on anyone’s mind when defaults were occurring everywhere,” he said.
Cisterna's attraction to the SFR space stems, in part, from the positive feeling he associates with creating "good homes" for families. "You don't get that same kind of feeling if you finance an office building," he said.
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