NexMetro Completes $333M Recap of BTR Portfolio
JLL Capital Markets arranged the financing on properties located in three states.
NexMetro Communities has completed a $333 million recapitalization of a portfolio of eight build-to-rent properties in the states of Arizona, Colorado and Texas. JLL arranged the transaction in which Stockbridge is investing $65.9 million of preferred equity alongside existing assumable agency financing totaling $206 million.
The portfolio features 1,061 mostly detached, single-level BTR homes across the eight properties in three states.
This is the second closing in just over six weeks for a 12-asset portfolio owned by NexMetro. The previously announced financing included $78.7 million in equity via Artemis, and $160 million of senior debt via Blackstone across four BTR assets in Arizona and Colorado. The combined portfolio was valued at $620 million; $145 million of equity was committed along with $366 million of senior debt.
“Navigating and keeping underwriting up to date on eight different assets while adapting to market fluctuations and end-of-year timelines was a challenge,” Josh Hartmann, CEO of NexMetro, told Multi-Housing News.
“Our teams were nimble and creative in structuring preferred equity behind the existing agency senior debt, allowing for cash distributions to current investors.
“NexMetro achieved its capital strategy goals by collaborating with our strong project teams at Stockbridge and JLL, and quickly adapting to dynamic market conditions.”
Growth markets
Completed between 2018 and 2019, the eight properties are Avilla Camelback Ranch, Avilla Centerra Crossing, Avila Deer Valley, Avilla Lehi Crossing, Avilla Meadows, Avilla Buffalo Run, Avilla Northside and Avilla Heritage, all in key growth markets.
As a result of the most recent recapitalization, NexMetro is able to return capital to investors and at the same time continue to develop projects in its pipeline. Completed, under construction or in development are 60 projects across the U.S. Sunbelt.
Representing the borrower, the JLL Capital Market’s Debt Advisory team was directed by President Kevin MacKenzie. Also part of the team were Michael Joseph and Brad Miner, senior managing directors; Matthew Putterman and Chris Shea, managing directors; Caroline Novak, director; and Weston Nearon, senior analyst.
