Dealmaker: Red Capital Group Provides $52.5M for Affordable Housing in Houston
MBA NewsLink Staff
Red Mortgage Capital LLC, Columbus, Ohio, closed a $52.5 million financing deal with Dalcor Holdings LLC for Vista on Gessner, an 805-unit multifamily development in Houston.
The transaction includes a first lien $50 million Fannie Mae M.TEB (MBS as Tax-Exempt Bond collateral) and a simultaneously executed second lien $2.5 million co-terminus taxable tail. This is RED's third transaction with Dalcor.
"The Fannie Mae M.TEB financing structure made it viable for Dalcor to acquire and renovate Vista on Gessner along with several other properties in the past couple of years, resulting in the preservation of this important housing stock," said Tracy Peters, Senior Managing Director of Affordable Housing with RED. She said the partnership has resulted in more than 1,500 affordable housing units preserved and renovated in Texas.
Built in 1977, Vista on Gessner consists of two- and three-story buildings. The acquisition and renovation will convert the property into 805 units of upgraded affordable housing with 100% of the units affordable to 60% of the Area Median Income. The property includes a leasing office and clubhouse, three swimming pool areas, on-site laundry facilities and a library.
‘With more than 800 apartments, Vista on Gessner has been a significant focal point of affordable housing in Houston," said Dale Dodson, CEO of Dalcor Companies.
All apartments will be updated with new windows, sliding glass doors, cabinets and countertops, appliances, HVAC systems, plumbing and electrical fixtures. Exterior and common area improvements will include new roofs, stairs and railings, parking lot and walkway repairs, gazebo and swimming pool repairs, and cosmetic repairs and additional upgrades. The renovation includes the addition of a fitness center, business center and a library, and will include 42 accessible units and 19 units accommodating hearing impairment.