Investment Sales activity picks up: NorthMarq’s Dallas office celebrates sale of five multifamily properties

DALLAS, TEXAS (September 30, 2020) – NorthMarq’s Dallas office recently completed the sale and financing of five multifamily properties totaling 1,153 units in the Dallas/Ft. Worth market. The sales reflect a resurgence of investment sales nationwide after slumping during the COVID-19 pandemic. Heading into 2020, the outlook for the Dallas-Fort Worth multifamily market remains strong, with the market consistently leading the country in job growth and apartment absorption.

Despite the temporary COVID-19 impact, Dallas still managed to lead all markets with nearly $9 billion in total property transactions in the first half of 2020 – over 50 percent of which was multifamily product. The labor market in Dallas-Fort Worth has already begun to bounce back considerably, as more than 40 percent of the local jobs that were cut from payrolls during the shutdown had already returned by the end of June. A handful of employment sectors even expanded during the market hiatus, led by financial activities employment which grew by 2.6 percent in the last 12 months. Dallas-Fort Worth recorded a year-over-year wage increase of 3.7 percent (June 2020) which continues to support higher cost of living. Subsequently, the median sale price of closed multifamily transactions year-to-date is approximately $130,000/unit.

NorthMarq’s Multifamily Investment Sales team consists of Taylor Snoddy, managing director; James Roberts, senior vice president; Phillip Wiegand, senior vice president;  Eric Stockley, associate;  Charles Hubbard, financial analyst; Campbell Brook, financial analyst; and Devin Etzold, transaction manager. The Debt/Equity team consists of Stephen Whitehead, managing director; Lauren Bresky, senior vice president; and Will Hancock, vice president.

“Our recent closings are indicative of the strength of the Dallas multifamily market,” said Snoddy. “Operations have held up strong over the past six months. This, coupled with a historically low interest-rate environment, has led to a sharp increase in our activity.”

Fort Worth three-property portfolio: The portfolio consists of three properties: 208-unit Magnolia Crossing located at 5700 Boca Raton Boulevard in Fort Worth, Texas; 154-unit Mission Hill located at 525 King George Drive in in Fort Worth, Texas; and 80-unit Verona Apartments located at 350 Shady Lane Drive in Fort Worth, Texas.

The properties are located just under two miles from the I-30/I-820 interchange near top employment and service providers.

“The portfolio has significant upside in what is already a high rent growth submarket. Being able to immediately scale within the area was compelling to the buyer,” said Taylor Snoddy. “The buyer, a local investment group, has the ability to capitalize on planned upgrades to its units and common areas to better compete within a submarket already benefiting from these types of renovations.”

The NorthMarq Dallas Debt team was able to finance the assets through Freddie Mac’s FRED execution (now called the Middle Market program). This allowed the sponsor to take advantage of a streamlined process which allows for a quicker closing process as well as deal level cost savings.

“NorthMarq was able to arrange and execute this acquisition financing on behalf of the buyer which included max leverage, half term interest only at an all-in rate sub 3 percent,” said Lauren Bresky.

View at Lake Highlands: The 292-unit asset, located on a unique site that is just over 14 acres in what is a highly accessible yet secluded Lake Highlands 9855 Shadow Way in Dallas, Texas. Acquisition financing for the transaction was arranged for the borrower through NorthMarq’s in-house Fannie Mae team with a 10-year term on a 30-year amortization schedule. Read more about the transaction.

McCallum Communities: The asset, located in a premier location at 7740-7777 McCallum Boulevard in Dallas, Texas, totals 419 units. Situated just south of the George Bush Turnpike, McCallum Communities is located directly in the path of progress and one of DFW’s most rapidly growing submarkets and near many major employment hubs. NorthMarq arranged acquisition financing for the borrower through as an Optigo lender with Freddie Mac. The transaction was structured with a 10-year term on a 30-year amortization schedule at 80 percent loan to purchase price. Read more about the transaction.