Affordable Housing is Crucial After Harvey
Dalcor Holdings recently purchased Vista on Gessner, an 805-unit multifamily development, and will convert all units into upgraded affordable housing for 60% of the area median income.
HOUSTON—Preserving and improving affordable housing is particularly crucial to the area in the wake of Hurricane Harvey, which caused significant damage to the area’s economy and housing stock. With an aim toward providing affordable housing throughout Texas, Dalcor Holdings LLC recently purchased Vista on Gessner, an 805-unit multifamily development.
The acquisition and renovation will convert all units into upgraded affordable housing with 100% of the units affordable to 60% of the area median income. Red Mortgage Capital LLC provided a $52.5 million loan for the purchase. The transaction includes a first lien $50 million Fannie Mae M.TEB (MBS as tax-exempt bond collateral) and a simultaneously executed second lien $2.5 million co-terminus taxable tail. This is RED’s third transaction with Dalcor.
“Vista on Gessner exemplifies Dalcor’s continued commitment to creating, preserving and improving affordable housing in the markets that it serves,” said Tracy Peters, senior managing director of affordable housing at RED. “The Fannie Mae M.TEB financing structure made it viable for Dalcor to acquire and renovate Vista on Gessner along with several other properties in the past couple of years, resulting in the preservation of this important housing stock. It has been a great partnership with Dalcor, Fannie Mae and Red Capital Group that has resulted in more than 1,500 affordable housing units preserved and renovated in Texas.”
Originally built in 1977, Vista on Gessner is comprised of two- and three-story buildings. The property includes a leasing office and clubhouse, three swimming pool areas, on-site laundry facilities and a library. All apartments will be updated with new windows, sliding glass doors, cabinets and countertops, appliances, HVAC systems, plumbing and electrical fixtures. Exterior and common area improvements will include new roofs, stairs and railings, parking lot and walkway repairs, gazebo and swimming pool repairs, and cosmetic repairs. The renovation includes the addition of a fitness center, business center and a library, and will include 42 accessible units and 19 units accommodating hearing impairment.
“With more than 800 apartments, Vista on Gessner has been a significant focal point of affordable housing in Houston,” said Dale Dodson, CEO of Dalcor Companies. “Our acquisition and planned renovations will not only preserve this crucial affordable housing, but will provide significant upgrades that will improve its quality and curb appeal.”
Vista on Gessner was Dalcor’s 12th acquisition and rehab since 2012. No maintenance on the property was required due to Harvey’s destruction.
“This particular property was not damaged in Harvey,” Lisalynne Quinn, director of marketing, RED Capital Group, tells GlobeSt.com. “However, the area suffered from an immediate need for affordable housing due to the damage that so many suffered.”
Dalcor believes that regardless of a person’s income strata or economic circumstances, all are worthy of quality housing, and that is Dalcor’s objective with each rehabilitation. Dalcor searches for opportunities to improve the living standards for renters and enhance the surrounding community.
RED Capital Group has provided more than $78 billion of integrated debt and equity capital since 1990 to senior housing and healthcare, multifamily, affordable and student housing industries through three operating companies. RED Capital Partner LLC provides proprietary debt and equity solutions, and asset management in a range of forms, including subordinated gap and bridge loans.