Cottonwood, Texsun Continue Texas Multifamily Buying Spree

Class B multifamily is still trading hands in North Texas.

Los Angeles-based private equity firm Cottonwood Group teamed-up with Dallas-based Texsun Holdings to acquire the 224-unit Taylor Commons apartments in Fort Worth last month, according to a news release.

The seller was not disclosed, but property records reveal it is Good Life Housing Partners, a student housing and multifamily investor also based in L.A. Financial details of the deal were kept private, but the complex has a taxable value of $25 million or about $112,000 per unit, according to the Tarrant County Appraisal District.

Rent prices range from $900 to $1,300 a month, according to online listings.

The 172,000 square foot property is located just off Interstate 30, at 5600 Cotswold Drive, on the eastern side of Fort Worth. The apartments are 6 miles from downtown Fort Worth and 9 miles from AT&T Stadium.

The Cottonwood and Texsun partnership has been active, as this will be their sixth Texas multifamily acquisition. The companies jointly own three properties in San Antonio and two in Fort Worth. Their Texas portfolio now holds 1,200 Class B units.

Texsun invests in value-add Class B and C assets that are undercapitalized and have unique characteristics in strong submarkets, according to its website. The company holds its multifamily properties for three to seven years before selling.

Distress has begun to leak into the multifamily sector in Texas, which has been booming at a historic pace in recent years. Texas investors continue to shy away from the word “distress,” but firms are building war chests to target opportunities, particularly in the Class B multifamily sector.

Real estate investment though has remained strong in Fort Worth, the fastest-growing major city in the United States.

Roughly $2.3 billion worth of developments are under construction or in the pipeline in Fort Worth, comprising a wide range of projects and driving investors to the city. Fort Worth’s population has risen 4.1 percent since 2020 to about 1 million, marking the sharpest increase among the 30 most populous U.S cities.