Starlight Investment JV to Secure $1B Refi
Nearly 6,000 units spread throughout eight states back the debt.
A joint venture of Starlight Investment, PSP Investments and Future Fund Board of Guardians will secure a debt package of more than $1 billion to refinance a portfolio of 5,963 units throughout eight states and 10 metros, according to a credit report by Morningstar DBRS.
The financing will consist of a $972 million, two-year interest-only CMBS loan bearing a rate of 5.35 percent, with three one-year extension terms. JP Morgan Chase, Citi Real Estate Funding and Wells Fargo are set to issue the funds. Deutsche Bank will serve as trustee, while KeyBank is slated to be the master and special servicer. The debt package also includes a $50 million mezzanine loan.
The joint venture had acquired the collection for nearly $1.7 billion between 2015 and 2023. They subsequently invested approximately $104 million in capital improvements, renovating more than half of the portfolio’s units.
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Consisting of 18 garden-style communities, the assemblage features an average debut year of 2006 and unit size of 1,000 square feet. The portfolio was 92.4 percent occupied as of September with an average in-place rent of $1,684.
The properties are spread throughout Texas, Colorado, North Carolina, Florida, Arizona, Georgia, Tennessee and Nevada. Most of them—14 communities—are in suburban Sun Belt markets.
The Landing at Round Rock, a 583-unit community in Round Rock, Texas, is set to receive the largest share of the debt, nearly $81.8 million. This community makes up almost 10 percent of the collection’s total unit count, while its average apartment square footage and occupancy were both above portfolio average.
Starlight had $22 billion in assets under management, including 70,000 multifamily units throughout the U.S., Canada and the U.K. Two months ago, it sold two assets in Orlando, Fla., for nearly $108 million to Cantor Fitzgerald.
Multifamily CMBS delinquencies on the rise
Overall CMBS delinquency rates ticked up 6 basis points in August, reaching 7.3 percent, according to a Trepp report. In multifamily, the rate skyrocketed 71 basis points, landing at a nine-year high of 6.9 percent.
Despite this rise in delinquencies, CMBS deals continue to close. Blackstone is on track to secure a $435 million CMBS loan backed by a 1,717-unit portfolio across Massachusetts, Florida and Georgia.
