Financing Inquiry Leads to Value-Add Sale and 1031 Exchange Acquisition
The sales of Regency Park and Travis at the Lake were part of a unique situation that began as a discussion about refinancing, and then led to a value-add sale and 1031 exchange acquisition of another property.
AUSTIN, TX—The recent sale and financing of Regency Park, a 528-unit value-add multifamily asset in south Austin and Travis at the Lake, a 312-unit 2018-built multifamily community in west Austin, were part of a 1031 exchange representing more than $250 million in dispositions and financing. Regency Park has access to downtown and Travis at the Lake has views of Lake Travis.
The Regency Park buyer was Greystar, a rental housing investment, development and management firm that currently owns more than 45 properties in the greater Austin area. The undisclosed Regency Park seller was a private investment group based in Naples, FL.
Newmark Knight Frank vice chairman Patton Jones represented the Regency Park seller. Jones then represented seller San Antonio-based Kairoi Residential in the trade of Travis at the Lake to the Regency Park seller.
“This was a unique situation that began as a discussion about refinancing and then led to a value-add sale and 1031 exchange acquisition of another property,” Jones said. “We were pleased to have been able to meet the needs of three clients in one coordinated seamless transaction.”
Both dispositions were financed by Matt Greer, executive managing director in NKF’s multifamily capital markets debt and structured finance group in Austin.
“The sales of Regency Park and Travis at the Lake represented over eight months of work from our respective teams during unprecedented times,” said Greer. “Greystar was able to enter the Austin value-add property class in a meaningful way with the purchase of Regency Park and Travis at the Lake provided the buyer the opportunity to trade into a best-in-class asset at historically low interest rates.”
For the past 12 months, 303,650 units were delivered nationally compared to 177,007 units absorbed. The largest markets in Texas (Austin, Dallas, Houston and San Antonio) account for 17.9% of national deliveries this past year, according to a Newmark Knight Frank second quarter report.
“These transactions were consummated back in June in the midst of COVID-19. However, both buyer and seller are long-term investors that feel strongly about the positive trajectory of the Austin multifamily market,” Jones tells GlobeSt.com. “Today, the city of Austin has one of the most positive multifamily markets in the country, thanks to major employment growth attributed to major tech firms. In addition, there is a scarcity of listings to serve the pent-up buyer demand.”