Goldman Sachs JV Acquires DFW Portfolio

The buyers plan to make capital improvements and provide support services at the properties.

Pool area and clubhouse of an Obsidian property located in Euless

Pool area and clubhouse of an Obsidian property located in Euless, Texas. Image courtesy of CAF Funds

A joint venture between CAF Funds, the acquisition-focused subsidiary of CAF Cos. and Goldman Sachs Asset Management’s Urban Investment Group has completed the purchase of the Obsidian portfolio, an eight-community, 2,766-unit collection of multifamily properties around the Dallas-Fort Worth area.

The acquisition is part of CAF’s Impact + Housing investment platform, which places affordability restrictions on its properties, in addition to partnering with nonprofits to offer residents a number of wellness and professional development services. The purchase was financed through a loan from Freddie Mac, which provided funding in exchange for the buyers bolstering the properties’ affordability and providing resident support services.

The buyers are planning a number of sustainability-focused upgrades to all of the properties in The Obsidian portfolio, including increased energy efficiency through the use of LED lighting, improvements to water fixtures, upgraded HVAC units and smart landscaping. Making use of CAF’s Impact + Housing platform, communities across the portfolio will partner with a number of nonprofits, offering residents a list of free services including childcare, academic tutoring, summer camps, career development, rent assistance and financial literacy. CAF is making use of the Esusu credit-building software to report on rental payments at all communities in a bid to boost resident credit scores.

Matt Falkin, Vice President of CAF Funds detailed the utility of such programs and practices to Multi-Housing News, particularly as they relate to the larger affordable housing market around the Dallas-Forth Worth area. “An acquisition of this scale allows us to make a meaningful impact in our backyard via an innovative approach to affordability. First, via self-imposed rent restrictions that are designed to preserve affordable housing stock. Second, and a bit less obvious, by providing on-site social impact programming such as career certificate trainings that allow residents to boost their earning potential.”

The purchase of The Obsidian Portfolio brings the buyers’ total owned assets under Impact + Housing platform to 6,000 units.

DFW’s affordable digs

Nearly all submarkets of Dallas’ multifamily sector have continued on the upswing, with the city’s strong economy showing a friendly face toward those in need of more affordable housing. Through May, Renter-by-Necessity rates rose by 1.3 percent to $1,232, according to data from a July 2022 report from Yardi Matrix. Such increases are owed in part to the city’s affordable housing occupancy rate, which has risen by 110 basis points year-to-date, to 95.5 percent, according to the report.

The cities are a lucrative investment opportunity for affordable housing as well, attracting some of the nation’s top financial backers. In November, Greystone provided a $43.2 million loan for the refinancing of Oak Tree Village Apartments, a 272-unit community in Dallas.

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