Investor Lone Star Funds snaps up almost 1,200 D-FW apartments from builder JPI
By Steve Brown
5:00 AM on Nov 17, 2020
Just-completed three-property purchase is the second such deal this year. The Jefferson 1900 apartments in Farmers Branch were included in the sale.
Apartment builder JPI has just closed another huge sale of North Texas rental units. The Irving-based developer has sold almost 1,200 apartments in Irving, Farmers Branch and Grapevine to an affiliate of Dallas-based investor Lone Star Funds. It’s the second big apartment sale this year JPI has made to Lone Star.
The properties included in the just-completed deal are the Jefferson Promenade in Las Colinas, the Jefferson 1900 in Farmers Branch and the Jefferson Silverlake in Grapevine. All of the apartment communities sold were recently built and are substantially leased.
The new sale follows Lone Star’s purchase of almost 2,000 JPI apartments in August. The acquisition of five Dallas-area communities was one of the largest such local transactions on record.
“To solidify two multi-property sales within just months of each other speaks to the resiliency of the industry, as well as of the North Texas economy,” Blake Taylor, JPI’s senior vice president and regional development partner, said. “Lone Star Funds was great to deal with.
“They can trust our product and our ability to perform,” he said. “It makes it easier to do a second sale.”
Terms of the purchase were not disclosed.
JPI is North Texas’ busiest apartment builder, with more than 5,000 rental units under construction.
“We just started construction on development of a community in Frisco,” Taylor said. “And we plan to proceed with construction on another project in Irving in a couple of weeks.”
The Jefferson at the Grove apartments in Frisco has 424 units, and the planned development in Irving will be 325 apartments, Taylor said.
He said the builder is ramping up for more construction next year.
“We feel good about 2021,” Taylor said. “We are in full design on three communities and expect to have a fourth one.
“All of them are in the D-FW area,” he said. “We aim to be back in the six community development range by 2022 — our typical pace.”
Apartment building activity in North Texas slowed earlier this year when the pandemic put a pause on many projects. But an expected plunge in apartment rental demand and a flood of tenant evictions didn’t materialize.
“We are pleased with how things turned out in D-FW,” Taylor said. “The coastal markets with the higher rents are struggling more.
“The expensive California and Northeast properties are struggling more with shutdowns and rent collections.”
The D-FW area led the country in third-quarter apartment leasing and building.