TIC Group Closes $36M Purchase of 382 Units

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HOUSTON-The Passco Cos. LLC has spent $35.62 million to acquire the 382-unit Raveneaux Apartments. The deal closed with a $24.47-million loan and short-term mezzanine piece to accommodate post-closing, tenant-in-common admissions.

Mark Strauss, managing director for Newport Beach, CA-based Cohen Financial, says the seven-year-old Raveneaux Apartments, located at 14500 Cutten Rd. in the northwest submarket, had a 91% occupancy at the time of closing. He points out that the stable, fairly new property, combined with a strong borrower reputation, meant that multiple lenders aggressively pursued the opportunity.

“The sponsorship was strong as was the reputation,” Strauss tells GlobeSt.com. “When you have a good borrower with a good reputation, and it’s a repeat borrower, then the lenders come out. They like to do business with them.”

A Wall Street conduit provided a 10-year, non-recourse package at a 70% loan-to-value ratio with seven years of interest-only payments and 30-year amortization. Comparable packages carry a sub-7% fixed-rate interest. Strauss and Cohen director Bruce Krall arranged the financing.

Strauss says the debt mainly was used to acquire the asset, but the Irvine, CA-based borrower also is putting together additional reserves from the financing to maintain the property. “This is still a fairly new project and needs little upgrade or deferred maintenance,” he says. “It’s in pretty good shape.”

The apartment complex, situated on 19.9 acres, has one-, two- and three-bedroom units, ranging from 801 sf to 1,663 sf. The monthly rents start at $743 and end at $1,592.