Dalcor Holdings LLC, an arm of Dalcor Cos., has obtained $52.5 million in financing to acquire and renovate Vista on Gessner, an 805-unit multifamily property in Houston. The buyer will convert the property into 805 units, with all units affordable to renters with 60 percent of area median income.
Originally built in 1977, Vista on Gessner is comprised of two- and three-story buildings. The property includes a leasing office and clubhouse, three swimming pool areas, on-site laundry facilities and a library.
According to Dalcor, preserving and improving this housing is particularly important to the area in the wake of Hurricane Harvey, which hit the Texas coast last August and caused significant damage to the area’s housing stock. “With more than 800 apartments, Vista on Gessner has been a significant focal point of affordable housing in Houston,” said Dale Dodson, CEO of Dalcor Cos.
Financing Done Through Fannie Mae
Red Mortgage Capital LLC, the proprietary debt banking arm of Red Capital Group, facilitated the financing. The transaction includes a first lien $50 million Fannie Mae M.TEB (MBS as Tax-Exempt Bond collateral) and a simultaneously executed second lien $2.5 million co-terminus taxable tail. This is Red’s third transaction with Dalcor.
“The Fannie Mae structure made it viable for Dalcor to acquire and renovate Vista on Gessner, along with several other properties in the past couple of years,” said Tracy Peters, senior managing director of affordable housing at Red. The Texas Department of Housing and Community Affairs and Affordable Housing Partners were also parties in the transaction.