GVA Real Estate, an aggressive multifamily syndicator whose portfolio has landed in hot water over the last year, has sold an apartment complex in the Austin suburbs in a “forced sale.”
GVA, which pools equity to buy property, sold 302 North apartments in Georgetown, for $25.3 million, according to property records filed with Williamson County and investor materials obtained by The Real Deal. The price for the 176-unit complex, built in 1985, was under $144,000 per unit.
Cooper Street Capital, an investment firm based in Aspen, Colorado, bought the property and raised equity from RealtyMogul, an online investing platform, to do so, according to an investment summary. Cooper Street did not respond to a request for comment.
“As anticipated, this real estate operator is now in a ‘forced sale’ scenario for a large portion of their portfolio to free up liquidity and to stave off greater potential losses in other assets,” Cooper Street said in its summary, referring to the seller, GVA.
GVA head Alan Stalcup called Cooper Street’s comments “an incorrect statement,” but did not elaborate further on why the firm sold.
Cooper Street “believes the seller, like many operators, may be facing a ‘cash crunch’ and, in some instances, the market valuations for some assets are below the loan balance,” the firm wrote in its summary, adding it “believes that the seller was willing to accept this markdown to free up liquidity where it was possible to do so in their portfolio.”
Cooper Street assumed the Fannie Mae loan, which expires in October 2032, as part of the deal.
Cooper Street was seeking $5.6 million in equity for its acquisition, though it’s unclear how much came from RealtyMogul. The firm required a minimum investment of $35,000 and is expecting to sell the property in May 2025, after which it will distribute proceeds to investors.
“The past few months for commercial real estate have been extremely difficult,” Stalcup wrote earlier this year in an investor letter earlier, which was obtained by TRD. “Due to the unpredictable and unprecedented rise in rates, we have had to deal with loan defaults.”
One of GVA’s strategies to deal with defaults has been to sell for “equity recapture,” Stalcup said in the investor letter. It’s unclear whether GVA had defaulted on a loan tied to the property.
At $25.3 million, the deal marks a roughly 33 percent discount from what the complex was appraised at in August 2022.
GVA bought the complex at 302 Apple Creek Drive in 2018, records show, and scored a $23 million, floating-rate loan from Fannie Mae.
The firm put the property up for sale in early 2023, with Walker & Dunlop marketing a price of $33 million, according to the Cooper Street investor materials.
GVA scored a spot as one of the country’s largest landlords in 2022, according to the National Multifamily Housing Council. By 2023, GVA doubled its unit count to more than 30,000.
The firm’s strategy was in line with other syndicators at the time — use floating-rate loans to buy apartment complexes, renovate the units and then hike rents and capitalize on soaring rent growth in Sun Belt cities like Phoenix, Las Vegas and Austin.
But by November of last year, GVA was delinquent on more than $600 million in securitized debt and had lost a number of properties to foreclosure.
Suzannah Cavanaugh contributed reporting.
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