Harbor Group International Lends $40M on Houston Multifamily Acquisition

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Harbor Group International has provided a $40 million loan to Orion Real Estate Capital to help fund the acquisition of a 324-unit apartment complex located in a suburb north of Houston, Commercial Observer has learned. 

The financing went toward Dallas-based Orion’s off-market purchase of Laurelwoode Apartments at 10333 Research Forest Drive in Magnolia, Texas, a town about 40 miles north of Downtown Houston. Sources said it is a value-add opportunity for Orion, which will now move to deploy capital to gradually renovate and upgrade the interiors of each unit at the garden-style complex. 

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Global finance and advisory firm Newmark represented the seller in the deal, and also sourced and arranged the debt financing on behalf of Orion. Newmark’s Thomas Alleman, Zach Springer and David Mitchell represented the seller in offloading the property, while Henry Stimler and Bill Weber led the debt arrangement, alongside Ari Schwartzbard and Clifford Welden.

Stimler said the deal was attractive to HGI in that it “understood the market [and] Orion’s business plan,” and was able to tailor and structure the financing to meet the needs of the borrower.

Laurelwoode is a gated community situated on more than 12.5 acres and comprises one dozen three-story buildings, spanning more than 286,800 square feet, with a mix of one-, two- and three-bedroom residences. Property amenities include a central clubhouse building, a business center, a fitness center, a resident lounge, an outdoor kitchen, as well as a swimming pool and sun deck. 

The property is across the street from a large shopping center called Westwood Village, which includes a Target. The shopping center and surrounding area is complete with a variety of restaurants, grocery and department stores, and other shopping outlets, such as Kroger, TJ Maxx, Home Depot and PetSmart

Laurelwoode is also approximate to local schools and ample park space, and there’s an emergency medical clinic called America’s ER Medical Center adjacent to the complex. 

Monthly rents at Laurelwoode range from $824 for one-bedrooms to north of $1,750 for three-bedroom units, according to listing information from Apartments.com.