Riparian Capital Secures $55M Financing for Two Workforce SFR Portfolios in Baltimore

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Riparian Capital Partners has secured $54.7 million in financing for two single-family rental portfolios in Baltimore, consisting of 461 units in total. 

The financing, which included a refinancing on a 244-unit portfolio acquisition from October and acquisition financing of a 217-unit portfolio in December, was provided by New York-based Roc Capital and both loans carry five-year terms. 

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The portfolios consist of workforce communities in the city of Baltimore, with a focus on renters utilizing Section 8 and similar voucher programs, according to the company. 

One of the properties was 2120 Walbrook Avenue, a town house built in 1920.

The loans were arranged by David Merkin, managing director in Eastern Union’s mid-Atlantic Group.

“Multiple factors made this financing appealing to lenders,” Merkin told Commercial Observer. “These workforce housing units are largely occupied by Section 8 renters, which ensures a steady income flow. Lenders also liked the strength of the sponsor, which takes a mission-driven approach to its holdings and also brings an excellent track record in property management.”

Currently, Riparian Capital Partners holds more than $125 million in assets under management on behalf of its investors, making it one of the largest SFR operators in the mid-Atlantic region.

The company focuses on the workforce housing segment of the SFR market, according to Kristoffer A. Garin, Riparian Capital Partners’ principal and CEO, targeting rents that are affordable to households earning  60 to 100 percent of the area median income.

“Naturally affordable SFR rentals are an underinvested niche, as relatively few institutional operators focus on this subsector,” he told CO. “The segment represents an opportunity to preserve the long-term supply of affordable housing by providing much-needed capital to older housing units, while still generating attractive, risk-adjusted returns.”

CoreLogic’s most recent single-family rent index revealed that single-family rents  grew by 9.3 percent year over year in August 2021..

“In Riparian’s case, our best-in-class social impact effort further enhances our ability to deliver market-leading returns to our investors, while also realizing community-friendly outcomes in the face of a national housing affordability crisis,” Garin said.

Cushman & Wakefield’s Ari Azarbarzin represented Riparian in both portfolio acquisitions.

Requests for comment from Roc Capital were not immediately returned.

Keith Loria can be reached at Kloria@commercialobserver.com.