Ares takes former Greystar apartment highrise after no minimum bids

An east Dallas building with apartments and a grocery store has been returned to its lender after a foreclosure auction failed to attract bids.

An affiliate of Ares Commercial Real Estate has taken control of the 2-acre property at  770 Cantegral Street, which includes the 378-unit Gabriella apartments, the Dallas Business Journal reported. 

The foreclosure stemmed from a $127 million loan owed by an affiliate of South Carolina-based developer Greystar, the entity behind the property. Ares scheduled a foreclosure hearing last month. The loan amount comes to almost $336,000 per unit.

The starting bid at the Feb. 6 auction was $80 million, but no one stepped forward, resulting in the property being taken back by Ares, the outlet reported, citing Roddy’s Foreclosure Listing Service. The starting bid comes to $211,600 per unit.

The property was valued last year at $138 million by the Dallas Central Appraisal District.

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Greystar’s loan trouble isn’t the first time it’s faced challenges with the building. In 2019, a tower crane collapsed while the apartments were being constructed, resulting in the death of a woman living in the adjacent building. Last year, a jury awarded $860 million to the woman’s family, and Greystar was found liable. 

The property, completed in 2020, features a Tom Thumb grocery store, spanning 55,000 square feet, on the ground floor. It also has a gas station. 

Rents for the Gabriella range between $1,487 and $4,281 per month, with floor plans ranging from studios to three-bedroom units, according to Apartments.com. Amenities include an infinity edge pool, a golf simulator and a fitness club.

Greystar is one of the largest apartment managers in the nation, overseeing nearly 727,000 units. The firm has 66 offices across the globe.

—Quinn Donoghue