Category: US/Texas CRE News

S2 Capital Becomes Largest Multifamily Buyer in Texas Over the Past 24 Months

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S2 Capital is now the largest multifamily buyer in Texas with its latest four-property acquisition, bringing its total number of units in the Lone Star State to 16,000.

The four-property transaction, totaling 1,893 units, includes Hyde Park at Montfort in Dallas (662 units), Twin Creeks Crossing I (347 units) and Twin Creeks Crossing II (330 units) in Allen, and Tintara at Canyon Creek in Austin (554 units).

S2 plans to spend more than $7.2 million on renovations at the Tintara at Canyon Creek property, some of which include upgrading the pool, leasing office, gym, flooring, appliances and countertops. Additionally, S2 will spend more than $6.6 million on Hyde Park at Montfort renovations, including upgrading finishes to balcony fencing and railing, landscaping and the swimming pool exterior, while implementing new flooring and materials on the interiors.

“When Covid first hit, S2 quickly recognized that the market trends we witnessed in Texas and the Sunbelt pre-pandemic were going to dramatically accelerate in a post-pandemic environment,” said S2 Capital CEO Scott Everett. “The 10-Year Treasury spread to cap rates jumped 300 basis points overnight and we started buying as much as we could handle. I’m very proud of our team’s ability to acquire 13,000 units totaling $2.5 billion in the past 24 months, and we have no plans of slowing down.”

Taylor Snoddy, James Roberts and Philip Wiegand of NorthMarq’s Dallas investment sales team represented the seller of the transaction, which closed on Sept. 30. NorthMarq’s Dallas Debt/Equity team of Executive Vice President/Executive Managing Director Jeffrey Erxleben, Senior Vice President Lauren Bresky, Vice President Kevin Leamy, and Investment Analyst Loren Heikenfeld arranged floating rate debt that was heavily tailored to the sponsors business plan.

“This was a true team effort for TKG/Provident, S2 Capital and NorthMarq,” said NorthMarq Senior Vice President James Roberts. “The seller had amassed a sizeable portfolio of assets spanning multiple markets and product types which was very appealing to S2. This sale rounds out over $1 billion for our Dallas team in September which speaks to investor appetite for multifamily in Texas.”

“The sponsor elected to go with Blackstone as their balance sheet bridge lender who offered certainty of execution at very attractive terms,” Erxleben said. “The quality of this portfolio and Sponsor aided our ability to deliver a market leading financing.”

S2 currently has $1.1 billion under contract to sell between now and Dec. 1 across 21 deals resulting in a blended net internal rate of return for its investors of 41% and a 2.4 LP MOIC. S2 will transact on $4 billion this year across 54 transactions.

Leasing Momentum continues, Driving Record Occupancy Gains

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• Leasing volume reached 10 million s.f. in Q3, bringing the year-to-date total to 31 million s.f.
• Consistently high demand resulted in 9.5 million s.f. of quarterly net absorption, a figure which matches the 10-year annual average
• Total vacancy declined for a third consecutive quarter and fell to 8.6%
• Deliveries for the quarter hit 8.1 million s.f. and were 83.2% preleased due to owner-user and build-to-suit completions

Houston’s industrial market continued to move at a rapid pace with another strong quarter of demand. Leasing activity was led by Chewy.com’s entry to Houston with a 690,000-s.f. deal at Northpoint 90 Logistics Center and an expansion in the market by an e-commerce user for 629,186 s.f. at Prologis Presidents Park, both of which were build to suits. Four consecutive quarters of robust leasing volume led to a flurry of move-ins from both a new and expanding tenant base, largely in first-generation product. Notable completions included a 1.5-million-s.f. build to suit for Lowe’s in New Caney, 1.9 million s.f. across two projects for an e-commerce company in the Southwest and 1.3 million s.f in two buildings in the North and Northwest submarkets for Home Depot. These companies, among many others, drove Q3 net absorption to 9.5 million s.f., and this momentum is expected to continue through the final quarter of the year. Given the volume of occupancy gains, vacancy dropped 40 basis points quarter-over-quarter to 8.6%. Demand is ahead of supply year to date, a trend which should carry through the close of 2021. Construction activity decreased 15.5% to 11.9 million s.f. despite 5.6 million s.f. of new groundbreakings. Rising materials costs and supply chain issues are still causing some delays, but several new building parks are poised to break ground in early Q4, and even more are in permitting and design phases for early 2022. Additionally, the flight to quality and appetite for new construction are driving an increase in asking rents across the metro. Click to read more at www.us.jll.com.

Whitestone REIT: Commercial Real Estate Portfolio With a Community-Focused Approach

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Time and time again, real estate continues to prove itself as a strong possible choice as an investment class. Real estate investing can yield high returns, cash flow generation, and portfolio diversification. It’s renowned as a hedge against volatility and doesn’t typically correlate with stocks or bonds.

Unfortunately, high barriers of entry often prevent everyday investors from accessing the full benefits of this asset class — especially when it comes to commercial real estate. Although commercial properties offer great potential for rewards, they can be out-of-reach for the average investor.

This is where real estate investment trusts (REITs) come in. They can help make real estate investing more accessible by offering investors shares of companies that own and operate a portfolio of investment properties. REITs collect revenue from tenants and distribute those funds to shareholders in the form of dividends.

REITs can be a great way to add commercial real estate investments to your portfolio with the ease and advantages of owning publicly traded stock. But not all commercial REITs are created equally. Click to read more at www.finance.yahoo.com.

Clarion Partners Real Estate Income Fund Inc. (CPREIF) Closes on Three Strategically Important Acquisitions

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SAN MATEO, Calif.–(BUSINESS WIRE)–Oct 7, 2021–

Clarion Partners Real Estate Income Fund Inc. (CPREIF) has strategically expanded its property portfolio with three diversifying acquisitions: a multifamily property in Charlotte, N.C.; an industrial property in North Las Vegas, NV; and a multi-use property in a high-traffic area of downtown Austin, TX. Clarion Partners, LLC (“Clarion Partners”), a leading U.S. real estate investment manager, is one of Franklin Templeton’s specialist investment managers.

The three properties, all ideally situated within their growing markets, include:

Anker Haus (Charlotte, N.C.)

A 49-unit, build-for-rent townhome community located in the heart of the city’s Plaza Midwood neighborhood, less than four miles east of downtown. Resilient net migration, high barriers to new supply and strong employment growth have positioned East Charlotte as a high-growth sub-market. The project was designed as a “pocket neighborhood,” modeled after a European village. Its units feature modern finishes, with common amenities including a pool with adjoining cabana, fitness center, grilling area and dog park.

Congress Commons (Austin, TX)

A mixed-use asset that is 100% leased to Accenture, one medical tenant and three service-oriented retail tenants located along downtown Austin’s iconic Congress Avenue. The building’s interior features high-end, Class A finishes, and the location provides tenants excellent walkability to dining, entertainment and retail options. Click to read more at www.valdostadailytimes.com.

Staff from Don Quick & Associates Remember Founder’s Legacy

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Don Quick (center) is seen with his team in 2019 after winning a lifetime achievement award from the Round Rock Chamber. (Photos courtesy Don Quick & Associates)

Don Quick & Associates has served the Round Rock area and beyond since 1970, offering real estate and brokerage services to the community.

Founded by Don Quick, whose family has a long history in the city of Round Rock, the firm offers client-focused commercial real estate services such as landlord representation and leasing, tenant representation, real estate consulting and property management.

In 2018, Quick celebrated his 50th year as a Realtor followed in 2020 by the 50th anniversary of Don Quick & Associates. However, in late June and early July 2021, he and his wife, Eugenia “Jeanie” Quick, died after long battles with non-Hodgkins Lymphoma and cancer, respectively.

The company is now headed by their son, Darren Quick, who has worked with the firm since 1996.

“Don left a legacy of operating with integrity while servicing the commercial real estate needs of the Central Texas community,” Darren said. “We are thankful for the business relationships that Don created that we have continued to grow and flourish.” Click to read more at www.communityimpact.com.

NAR Identifies America’s Top 10 Commercial Office Markets of 2021

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Association’s latest commercial real estate report released during inaugural C5 Commercial Real Estate Summit in New York City

Key Highlights

Half of the top 10 commercial office markets are in Florida (Daytona Beach, Miami, Palm Beach) and Texas (Austin, San Antonio). Boise, Chattanooga, Myrtle Beach, Omaha and Provo round out the list. Since the second quarter of 2020, vacancy rates have declined for apartments/multifamily, industrial and retail properties. Compared to one year ago, asking rents climbed for apartments/multifamily (11%), industrial (7%) and retail (2%) properties, but declined for office properties (-0.4%).

The National Association of Realtors® identified the top 10 commercial office markets as of the third quarter of 2021 in its monthly Commercial Market Insights report released Monday. In alphabetical order, the markets are as follows:

Austin, Texas
Boise, Idaho
Chattanooga, Tennessee
Daytona Beach, Florida
Miami, Florida
Myrtle Beach, South Carolina
Omaha, Nebraska
Palm Beach, Florida
Provo, Utah
San Antonio, Texas

NAR analyzed 390 commercial real estate markets and found a robust recovery with positive net absorption and strengthening rents across the multifamily, industrial and retail property markets as economic production rebounds to pre-pandemic levels. The apartment and industrial sectors, specifically, are reporting historically low vacancy rates, while retail has undergone a more gradual recovery as consumers continue their return to brick-and-mortar shopping. Click to read more at www.globenewswire.com.