Greystone Provides $91M Fannie Mae Refi on Massive Tucson Rental Portfolio

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Tucson, Ariz.-based real estate investor and developer HSL Properties has nabbed just under $91.3 million in agency debt originated by Greystone to refinance a portfolio of four multifamily properties right in HSL’s backyard, Commercial Observer has learned. 

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The Fannie Mae non-recourse financings each have a term of 10 years and pay interest at a fixed rate, with five years of interest-only payments and 30-year amortization schedules. 

Greystone managing director Dan Wolins originated the debt on behalf of HSL Properties. 

“The new lending landscape has certainly introduced some challenges for multifamily property investors, but we have helped them to adapt and thrive with the capital options that are available,” Wolins said in a prepared statement. “[We work] diligently to be hyper-informed on local markets, changes in loan terms and rates, and to be able to provide a broad array of capital solutions when needed. We are very happy to team up with HSL again on these properties, which are long-held assets in their portfolio. They are a premier owner and operator in Tucson with unparalleled market knowledge.”

The portfolio comprises a combined 1,406 units and includes the 242-unit Canyon Creek Apartments; the 256-unit Ridgepointe Apartments; the 336-unit Catalina Canyon; and 572-unit Sycamore Creek.

Canyon Creek apartments in Tucson.
Canyon Creek apartments in Tucson. Courtesy: Greystone

HSL president Omar Mireles said in prepared remarks that the firm is “thrilled to have been able to close this financing during a pandemic, especially with credit markets being more challenged than ever.” 

Canyon Creek comprises studio, one- and two-bedrooms, with monthly rents ranging from $560 to $1,129, according to Apartments.com. Ridgepointe features one- and two-bedroom residences with rents ranging from $890 to $1,360. Catalina Canyon features one-bedrooms starting at $747 and two-bedrooms that top out at around $1,200. And finally, Sycamore Creek has studios, one- and two-bedrooms residences ranging from $573 to $1,099.

The ripple effects of COVID-19 on the broader economy, like ballooning unemployment figures coupled with business closures and quarantine lockdowns associated with the pandemic, have begun to set in on the multifamily sector, softening rents. According to data from Yardi Matrix reported by research firm Trepp, monthly rents in May fell 0.3 percent from April, to around $1,460 per unit, and they are now 0.8 percent lower than in March. But while some rent gains have been wiped out because of the pandemic, rates are still up nearly 1 percent from this time last year.