Encore Finance Group Closes $275 Million Single-Family Rental Securitization With Goldman Sachs

NEW YORK — Encore Finance Group (Encore), a private specialty real estate finance company, announced Nov. 2 the closing of ENCR 2026-SFR1, a $275 million securitization backed by 5-year fixed-rate mortgage loans it originated. The transaction is Encore's inaugural multi-borrower single-family rental (SFR) securitization, and Goldman Sachs & Co. LLC served as sole structuring agent, manager and bookrunner.

Encore Finance Group Securitization Details

ENCR 2026-SFR1 issued eight classes of notes collateralized by 36 Encore-originated loans secured by investor-owned real estate properties, the firm said. The loans, with balances ranging from $1.6 million to $32.2 million, provide permanent fixed-rate financing for 1,308 fully stabilized rental properties.

Total notes issued came to $274,909,099, effectively the announced $275 million. The issuer is ENCR 2026-SFR1 Issuer, L.L.C., and the sponsor and originator entity is Encore Residential Credit Partners REIT, L.L.C. Onity Group LLC is expected to act as servicer and special servicer, and U.S. Bank Trust Company, National Association is expected to serve as trustee and note administrator.

The rated transaction has a maturity of Oct. 15, 2041, although the collateral consists of five-year loans. The largest publicly identified class, the Class A notes, totals $175.598 million and is rated AAA by Fitch.

Based on reported pool totals, the collateral averages about 36 properties and $7.6 million per loan, with average debt of roughly $210,000 per property. Actual leverage varies by borrower, market and property type.

Goldman Sachs' Role as Structuring Agent

Goldman Sachs & Co. LLC acted as sole structuring agent, manager and bookrunner on the offering, according to Encore's announcement.

Encore's Capital Markets Strategy

Encore said the securitization supports its growth strategy of increasing its balance sheet and building infrastructure for a growing business model. In addition to raising significant equity capital over the past 12 months, the firm said the securitization continues to build out its debt capabilities and further strengthens the balance sheet.

"Balance sheet lending enables us to better accommodate client needs throughout lifecycle lending," said Beth O'Brien, founder and CEO of Encore Finance Group. "We intend to be a serial issuer in the capital markets to provide greater liquidity and structural flexibility to our clients."

Caroline Morrill, managing director and head of capital markets at Encore Finance Group, said: "The strength of our business-purpose lending model, origination expertise, in-depth underwriting process and access to capital markets enables us to continue to grow with our professional real estate investors and partner with them as their financing needs evolve."

Encore describes itself as a private specialty real estate lender that originates investor-driven real estate mortgage loans and is led by industry veterans with experience in real estate investment, mortgage lending and private lending.

Single-Family Rental Market Backdrop

The transaction comes as SFR fundamentals remain relatively steady. U.S. SFR occupancy averaged 94.3% in the second quarter of 2026, up 0.4 percentage points from the prior quarter but 0.2 points below the year-earlier level. SFR cap rates averaged 7.2% in the second quarter, little changed sequentially but about 190 basis points above the 5.3% low recorded in the fourth quarter of 2021.

The average SFR debt yield was 11.2%, unchanged for four consecutive quarters. The average 10-year Treasury yield was 4.4% in the second quarter, leaving a spread of roughly 280 basis points to the SFR cap rate.

SFR CMBS issuance reached $3.9 billion through July 2026, placing the sector on pace for roughly $6.7 billion for the year, slightly above the $6.4 billion recorded in 2025. An October 2026 market update estimated that smaller investors were generally paying roughly 6.5% to 8% for DSCR financing.

Implications for Encore

The securitization moves Encore beyond balance-sheet lending into capital markets issuance. Securitization can allow a lender to recycle capital from previously originated loans, increase lending capacity without retaining every loan on balance sheet, and establish a performance history for future issuance. Encore has said it intends to be a serial issuer.

For investors, the notes provide exposure to a diversified pool of loans to professional real estate investors rather than a single asset or borrower.

Sources

• Encore Finance Group press release: https://www.encorefinance.com/news-insights/encore-finance-group-closes-275-million-multi-borrower-single-family-rental-securitization/