Sovereign Properties Lands $49M Refi for Texas Apartments

Asia Capital Real Estate provided the loan for the 306-unit Millennium at Hometown in North Richland Hills.
Millenium at Hometown. Image courtesy of Sovereign Properties and Asia Capital Real Estate

Sovereign Properties has refinanced Millennium at Hometown, a 306-unit, Class A mixed-use multifamily community under construction in North Richland Hills, Texas. The $49.1 million loan was provided by Asia Capital Real Estate.

The loan, through its ACRE Credit debt fund, has a two-year initial term and two single-year extension options. It was underwritten with a LTV ratio of 70.8 percent. The loan was brokered by JLL Capital Markets Senior Managing Director Greg Nalbandian and Director Jesse Wright.

Daniel Jacobs, head of origination at ACRE, said in prepared remarks there is still significantly less liquidity in the transitional bridge space than there was in previous years even for multifamily properties. Jacobs noted that allowed ACRE to gain market share while providing institutional sponsors like Sovereign the liquidity to navigate current market conditions.

Property Details

Sovereign, which focuses on high-growth Sunbelt markets, acquired the land in the Dallas suburb in 2017. The firm, founded in 2004, also owns the 316-unit Dolce Living Home Town in North Richland Hills. Sovereign also owns Sovereign Twin Creeks, a 366-unit multifamily property, and 374-unit Dolce Twin Creeks, both in Allen, Texas, as well as assets in Burleson, Katy, Mansfield and Rosenberg, Texas.

The first of nine buildings at Millennium at Hometown is slated for delivery by November. The rest of the development is scheduled for completion in April 2021. The 7.7-acre mixed-use property will include 11,697 square feet of retail space. Located at 3021 Parker Blvd., the development will have one-, two- and three-bedroom units ranging in size from 702 to 1,300 square feet.

Amenities will include washer/dryers in all units, private balconies or patios, elevators and high-speed internet access. Retail will be located on the first floor of the four-story buildings. The multifamily community will feature a fitness center, business center, clubhouse and swimming pool. Covered parking will be available.

The Texas transaction represents the third deal closed by ACRE Credit within the last 60 days, totaling more than $200 million of first mortgage bridge financings. ACRE plans to continue focusing on financing multifamily assets and anticipates deploying more than $1 billion in capital in 2021.

In August, ACRE provided $86.9 million in refinancing to Wood Partners for its Miami luxury tower Yard 8, a 387-unit community in the Wynwood/Midtown area completed in May 2019. Also in August, City Club Apartments, owner of the Class A, 294-unit City Club Apartments-CCA CBD Cincinnati, refinanced the mixed-use property with a $68.5 million floating-rate loan provided by ACRE.