Texas Buyer's Double Deal Adds 512 Units

WEBSTER, TX-Venterra Realty Management has picked up two more Texas assets, totaling 512 units, for its multifamily portfolio. One is a class A and the other, class B.

The just-bought properties are the 152-unit Pointe at 40165 Old Dowlen Rd. in Beaumont and 360-unit Foxborough at 1400 Esters Rd. in Irving. The sale prices aren't available, but industry sources estimate comparable class A units in Beaumont can be acquired for $60,000 per unit whereas class B properties in Irving are typically priced at $30,000 per unit.

The Pointe, completed in 2002, is "right in the heart of the new retail area in Beaumont," explains Greg Finch, president of locally based Venterra Living. He tells GlobeSt.com that the new owner plans to invest an additional $500,000 into amenities like a pool, leasing office, business center and fitness facility.

Finch says the Pointe was bought with a 10-year loan secured through Lehman Brothers Inc. of New York City, which also kicked in equity for the deal. The financing, representing 75% loan to value, has five years of interest-only payments and a five-year amortization.

The Pointe, sold by Lynch Investments LLC of Southern California, contains one- and two-bedroom units from 1,081 sf to 1,232 sf. Its monthly rents are $980 to $1,050.Finch says the acquisition is Venterra's first in Beaumont. With a 97% occupancy, it made sense to add it to the portfolio, he explains. "Beaumont is tight especially when it comes to class A space," he adds. "There's been a lot of expansion in the oil refineries and jobs."

Foxborough Apartments was sold by Flagship Management Corp. of Houston, operating as FPC/Foxborough Apartments Ltd. Built in 1986, the complex was 83% occupied at the time of closing.

Finch says Venterra plans nearly $600,000 of renovations, which include deferred maintenance of common areas as well as a new leasing office and fitness center. Following the renovation, he says occupancy should stabilize. The one-, two- and three-bedroom units, measuring 612 sf to 1,064 sf, have rents ranging from $645 to $1,160 per month.

Foxborough's financing is a 60% loan-to-value deal with a nine-year term of interest-only payments, according to Finch. He says GE Capital Corp. of Stamford, CT provided equity; Eurohypo Aktiensgesellschaft provided debt.

Will Balthrope and Don Ostroff, senior directors for Cushman & Wakefield of Texas Inc.'s multi-housing group, brokered the Foxborough deal. Jeff Patterson with Apartment Realty Advisors in Houston handled the Pointe's sale.

Though he's not holding anymore contracts, Finch stresses Venterra is open to opportunities in Texas and the Southeast. "We're active in pursuing investments in both marketplaces," he says.