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Vancouver, Canada-based Trez Capital LP has invested $33.3 million in equity into a multifamily project just north of Leander, helping add density to one of the Austin area’s fastest-growing communities.

The approximately 500-unit apartment project will be at the entrance to Larkspur, a 608-acre master-planned community off the 183A toll road in Williamson County.

The capital investment, a partnership with developer Thompson Realty Capital LLC, will cover a third of the project’s $100 million price tag. It is part of Trez Capital’s joint venture program, which funnels money into development in fast-growing areas.

This is not the first time the two companies have partnered on a Texas project. They have completed three multifamily projects — 843 units total — and have three more in the pipeline that will add another nearly 900 units.

The multifamily development will happen in two stages, with about 250 units in each. All told, the project will include 504 garden-style apartments, as well as an amenity center and pool. Thompson Realty Capital will also be the property manager for the apartments. Construction is expected to begin this month.

According to John Hutchinson, global head of origination for Trez Capital, the Austin area is ripe for investment in all sorts of residential asset classes, not just multifamily. Single-family rentals, which have rapidly proliferated in the area in the past year, plus industrial development and even storage facilities are all potential investment targets for the company.

“We are making commitments to invest in various parts of Austin, where we think there’ll be population growth due to the proximity to jobs,” Hutchinson said. “In North Austin, you’ve got a lot going on with Amazon and Apple and Dell, the new Samsung facility. There’s massive growth with high-paying jobs.”

Trez Capital claims on its website it is Canada’s largest non-bank commercial mortgage lender. The real estate investment firm provides equity and debt financing on a wide variety of projects in its home country and the United States. It said on its website it had more than $3.9 billion in assets under management as of Sept. 30 and that it had funded more than 1,600 transactions totaling more than $13.5 billion since the firm was founded in 1997.

Trez Capital’s investments in the Austin area include more than $7 million in equity toward a community in Del Valle, which is expected to eventually include more than 2,000 single-family homes. Hutchinson said the company also owns land in Northeast Austin and Southeast Austin, and has some under contract in San Marcos.

While Trez Capital invests in a variety of residential asset types, Hutchinson said multifamily is particularly important in a place like Austin, where people may struggle to purchase a home. According to the Austin Board of Realtors, the metro had only 0.8 months of housing stock as of November, as opposed to a healthy market rate of six months.

The apartment market in the Austin area is booming, with a construction pipeline of 126 proposed communities, as of ApartmentData.com’s December report.Another Canadian company, Toronto-based Prism Multifamily Group Inc., recently made its first foray into the Austin market, buying a 324-apartment community at 5301 Decker Lane.


Publication: Austin Business Journal

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