In a petition filed with the Bankruptcy Court last week, Westminster Residential Acquisition LLC, an affiliate of Kushner Cos., proposed a debtor-in-possession credit facility in the amount of $4.5 million to be forwarded to Tarragon. The financing will replace an earlier DIP from Arkomd LLC that was negotiated earlier this year when Tarragon filed for Chapter 11 bankruptcy. That existing DIP facility was $6.3 million.

If the deal were approved, it would mark a significant re-entry by Kushner into the apartment market. In 2007, the locally based company sold off 16,784 apartments in 86 complexes in four states to a joint venture of AIG and Morgan Properties. Last year, after the insurer nearly went into bankruptcy, many of those properties were put up for sale.

At time of its bankruptcy filing, Tarragon had unsecured debt totaling approximately $170 million. Also, its outstanding secured debt on debtor and non-debtor projects was approximately $165 million and $595 million, respectively. Its guaranteed obligations totaled some $769 million.