Blackstone Group LP, the largest U.S. landlord of single-family homes, is working with Deutsche Bank AG to sell $1 billion of securities tied to its properties, about twice the size of previous offerings, according to a person with knowledge of the plans.

Deutsche Bank may start marketing the debt to investors within a month, said the person, who asked not to be identified because the transaction is private. The offering would be the fourth of rental-home bonds, following American Homes 4 Rent’s $482.7 million bond deal this month, Colony American Homes Inc.’s sale of $513.6 million of the debt in April and Blackstone’s $479 million issue in October.

Blackstone has spent $8.5 billion on almost 44,000 houses around the country through its Invitation Homes LP division, leading hedge funds, private-equity firms and real estate investment trusts seeking to profit from rising demand for rentals. The largest investors have raised about $20 billion to purchase as many as 200,000 properties in the past two years after prices nationally plunged as much as 35 percent from the 2006 peak.

Securitzation is an attractive source of financing because it gives landlords the opportunity to free up capital and provides borrowed money that’s more stable than credit lines, according to Jade Rahmani, a New York-based analyst at Keefe, Bruyette & Woods Inc.

“The proceeds for some of the issuers will be used to fund additional acquisitions as those companies continue to scale their platforms and grow in a targeted way,” he said.

Christine Anderson, a spokeswoman for New York-based Blackstone, declined to comment on the transaction, as did Amanda Williams, a Deutsche Bank spokeswoman.

Seeking Debt

Corporate landlords are looking to the debt market for capital to buy more houses and increase returns by adding leverage to the properties they purchased with cash. An affiliate of American Homes 4 Rent, the second-largest rental- home owner, with 26,000 properties, plans to sell bonds backed by 3,871 of its rental properties in states including Florida and Texas, with an offering beginning this week. Goldman Sachs Group Inc., Wells Fargo & Co. and JPMorgan Chase & Co. are underwriting the deal.

“One differentiating thing about that deal is that it’s in unique regions,” said Brian Grow, a managing director of residential mortgage-backed securities at Morningstar Inc. “The American Homes 4 Rent properties are in regions that were less volatile during the crisis than the other two deals.”

Securities Sold

Colony American Homes, the third-largest single-family landlord in the U.S., with 15,600 homes, last month sold securities linked to 3,399 properties in 20 metropolitan areas and seven states, according to deal documents. JPMorgan and Credit Suisse Group AG led the offering.

Starwood Waypoint Residential Trust, managed by an affiliate of Barry Sternlicht’s Starwood Capital Group LLC, has also announced plans to sell bonds backed by properties. The Oakland, California-based company has $1 billion invested in 7,400 rental homes and nonperforming loans.

American Residential Properties Inc., a landlord with more than 4,000 homes, and Silver Bay Realty Trust Corp., which owned 5,642 residences as of Dec. 31, also plans to sell the debt.