Starlight U.S. Multi-Family (No. 1) Value-Add Fund — managed by Starlight Investments — has acquired two properties located in Round Rock, Texas, and Phoenix, comprising 943 multifamily residential suites for $154.8 million.
The purchase price was satisfied by way of cash from the proceeds of the fund’s initial public offering and the proceeds of new first mortgages in the principal amount of approximately $105 million.
The fund indirectly acquired a 100 percent interest in The Landing at Round Rock, a property located 18 miles north of downtown Austin at 7711 O’Connor Road in Round Rock, Texas. In connection with the acquisition, new financing in the amount of approximately $64.7 million has been secured for a three-year term with two one-year extension options available, with an additional allowance for $5.1 million of future funding for capital expenditures. Subject to certain conditions, financing is interest only and will be payable at an annual rate of LIBOR + 2.00 percent. The property is comprised of 583 suites in 44 three-story apartment buildings on a 33.21-acre site. The property will be managed by Roscoe Properties, a regional multifamily property management company based in Austin. Roscoe currently manages 14,000 apartment suites in Texas.
The fund also indirectly acquired a 100 percent interest in Spectra South, a property located 19 miles north of downtown Phoenix at 20425 North 7th St. In connection with the acquisition, new financing in the amount of approximately $40.3 million has been secured for a three-year term with two one-year extension options available, with an additional allowance for $2.1 million of future funding for capital expenditures. Subject to certain conditions, financing is interest only and will be payable at an annual rate of LIBOR + 2.00 percent. The property is comprised of 360 apartment suites in 19 three-story buildings located on an 11.35-acre site. The property will be managed by Alliance Residential Co., the seventh-largest third-party multi-residential property management company in the United States, managing more than 99,000 apartment suites.
The balance of the net proceeds of the offering will be used to acquire an interest in one or more additional income-producing multifamily properties in targeted regions in the United States within nine months of the closing date of the offering, consistent with the primary purpose of the fund, and for working capital purposes.
