Veritas Seeks Buyer for San Francisco Apartments

Veritas, once the largest apartment landlord in San Francisco, continues to reduce its footprint in the city.

The company is listing 23 apartment buildings for sale, labeling the portfolio the San Francisco Neighborhood Collection, according a report in the San Francisco Chronicle.

The portfolio encompasses 762 rent-controlled units in apartment buildings in neighborhoods including Alamo Square, Russian Hill, Mission, Nob Hill, Tenderloin, Noe Valley and Lower Haight.

Eastdil Secured is marketing the portfolio. An asking price was not specified, according to the report.

“Located across many of San Francisco’s more desirable and very difficult to access neighborhoods, the Neighborhood Collection presents a compelling opportunity to acquire a portfolio of high-quality SF rental housing that would be virtually impossible to replicate via one-off acquisitions,” Eastdil’s marketing pitch says.

Last month, Brookfield Properties took the crown of San Francisco’s largest multifamily landlord from Veritas at a public foreclosure auction as the only bidder for two Veritas apartment portfolios.

Brookfield bid $386M for 62 apartment buildings encompassing 1,743 units and $77M for a second portfolio encompassing 422 units in 14 buildings.

In December, NYC-based Brookfield Properties acquired $915M of debt in two mortgages backed by the portfolios encompassing all 76 of the Veritas-owned apartment buildings.

The debt was purchased for an undisclosed price and consisted of two loans, a $675M loan backed by 62 buildings and a $130M loan backed by 14 buildings.

Veritas, at the time the owner of 7,500 apartment units in California, defaulted on the larger loan in November of 2022, and on the smaller loan in Q2 2023. The total debt grew to $915M by the middle of December.

When Brookfield and San Francisco-based Ballast Investments partnered to acquire the debt, there was an expectation that as the new lender to Veritas, Brookfield would be in a position to foreclose on the apartment portfolios backing the loans.

In September, San Francisco-based Prado Group bought a $124M mortgage portfolio backed by 21 apartment buildings encompassing 316 units owned by Veritas in the city. The debt was purchased from Veritas’ lender, an affiliate of Mack Real Estate Credit Strategies, according to a report in the San Francisco Business Times.

Last May, Eastdil began marketing delinquent loans divided into two Veritas portfolios backed by 95 apartment buildings encompassing 2,452 and 45 ground-floor storefronts, describing them as “trophy buildings in the city’s most coveted neighborhoods.”

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