Hunt Finances $65M Houston Apartment Acquisition
- May 05, 2016
Houston—Hunt Mortgage Group has provided a $65 million Fannie Mae loan to Village at Copperfield LLC for financing the acquisition of Villages of Copperfield, a 964-unit multifamily property in Houston.
“The property has 964 units and has maintained an average occupancy of over 94 percent, while offering much needed workforce housing in the NW Houston area,” Deborah Proctor, Hunt Mortgage Group’s vice president, told MHN. “The property is in a submarket with only 4.1 percent vacancy overall and only 1.9 percent in B/C properties, with rents projected to keep growing at an average annual rate of 2.55 percent through 2019.”
Located at 8750 Point Park Drive, Villages of Copperfield consists of 58 two- and three-story residential buildings, plus a single-story leasing office and maintenance storage shop. Amenities include three outdoor swimming pools, a tennis court, leasing office with fitness center, and five laundry facilities.
“The borrower is investing $6.67 million, $6,900 per unit in a moderate rehab program in order to solidify and strengthen the property’s competitive position in its market,” Proctor said. “With excellent coverage from in-place tenants, the moderate rehab will occur as units are vacated, eliminating down-time in the revenue stream.”
The loan is another deal structure with the Fannie Mae Mod-Rehab program including a 10-year term, with four years of interest only payments, followed by 30-year amortization period on an 80 percent loan to renovation cost.
“The Fannie Mae Moderate Rehab execution was the perfect product for this property—early ‘80s vintage, with strong history of occupancy and a large provider of workforce housing,” Proctor said. “The high workforce housing percentage also furthers the mission of Fannie Mae which is to promote affordable housing by providing loans to qualifying properties.”
The property is located 24 miles from the Houston CBD, just west of Texas Highway 6 and south of U.S. Highway 290, which bisects Houston’s NW quadrant and provides quick access to the rest of the metro area. The Houston Energy Corridor is located six miles south within an easy commute.
Village at Copperfield LLC, backed by key principal Joseph Lubeck, will co-manage the partnership with ESJ Capital Partners, LLC. Hunt Mortgage Group also financed Lubeck’s $25.4 million acquisition of Fountains of Katy, a multifamily property located in Katy, Texas with a similar structure, earlier in 2016.