Swapnil Agarwal’s Nitya Capital hit a $70 million distress patch after securing a blockbuster refinancing deal last year.
The Houston syndicator received foreclosure notices for three North Texas apartment buildings in May, according to Roddy’s Foreclosure Listing Service.
At Tuesday’s auction, Nitya could lose control of The Interlace Apartments, a 432-unit complex at 3801 Gannon Lane in Dallas; The Palace Apartments, a 280-unit complex at 1601 Regency Court in Arlington; and Chaparral Apartments, a 135-unit complex at 6520 Red Sierra Drive in Fort Worth.
One William Street Capital Management, which is based in New York, provided the $31.4 million loan for The Interlace, the $28.2 million loan for The Palace and the $10.7 million loan for Chaparral. The financing works out to $83,000 per unit.
Agarwal didn’t respond to a request for comment.
All three properties are owned by the Austin-based Texas Essential Housing Public Facility Corporation, indicating that Nitya used a now-closed loophole in Texas affordable housing law to secure tax breaks on the property. Nitya did sale-leaseback deals for each property in June 2023, weeks before House Bill 2071 closed the loophole that allowed public facilities corporations to operate outside their jurisdictions .
The distress comes about a year after Nitya secured a $700 million CMBS loan to refinance 18 multifamily properties while staring down the barrel of a $356 million past-due loan. Citibank originated the loan.
Prior to the refi deal, Nitya Capital appeared to be going the way of syndicator peers like Tides Equities, which went belly-up after interest rate hikes upended plans to purchase older apartments with floating-rate loans, fix them up and sell them at a profit.
The foreclosures aren’t the first rumblings of distress for Nitya since the refi deal. A $66 million CMBS loan tied to two apartment complexes owned by Nitya was flagged for special servicing in October after a receiver was appointed, Morningstar Credit reported at the time. The loan is marked as current but was delinquent in October, December, January and February, Morningstar shows.
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