A joint venture consisting of Related Cos. and the Texas Housing Foundation obtained $22 million in acquisition and rehab financing for a 556-unit, 14-property affordable apartment portfolio situated across 12 Texas communities. Red Capital Group, a division of ORIX Real Estate Capital LLC, closed the financing, through the USDA Rural Development program. Equity is being provided by Boston Financial Investment.
The portfolio consists of properties in Albany, Bastrop, Baytown, Burkburnett, Castroville, Electra, Elgin, Evant, Hondo, Lampasas, Beeville, Pflugerville and Round Rock. One challenge involved folding multiple properties, with outstanding USDA 515 debt, into one portfolio.
A spokesperson with Red Capital said the properties are between 25 and 44 years old, and all have rental assistance. Related will invest an average of $40,000 per unit for substantial improvements, which consist of everything from appliance replacements, to HVAC upgrades. The funding will help preserve the units’ affordability, according to Red Mortgage Capital.