Buchanan Buys Apartment Complex in Houston’s Spring Branch

Buchanan Capital Partners has acquired a multifamily property in one of Houston’s fastest-growing neighborhoods.

The Austin-based firm acquired the five-story, 258-unit Dakota at Bingle apartments at 2308 Bingle Road, in the Spring Branch neighborhood, according to a news release. The price wasn’t disclosed. It is valued for tax purposes at $68 million, according to the Harris Central Appraisal District.

Houston-based Dakota Enterprises developed the complex, which was delivered in 2021. Monthly rents range from about $1,200 to $2,300 a month, according to an online search.

Buchanan rebranded the complex Belle Spring Ranch and hired Valiant Residential to manage the property.

The acquisition is part of Buchanan’s strategy of buying high-quality multifamily properties whose bases are below replacement costs, said Buchanan Capital founder Keith Buchanan.

“We are focused on investing in submarkets with limited new supply pipelines and proximity to main employment corridors, and Spring Branch checks both of those boxes,” Buchanan said.

Many multifamily investors are on the sidelines amid hiked interest rates and a tough lending environment.

“We have been in a long bull market, and track records will be challenged.” Buchanan said. “We have never lost investor principal or made additional capital calls, and do not foresee this changing.”

The firm is also working to expand its investor base for the first time as it gears up for acquisitions.

Few multifamily properties have changed hands in Houston this year, but the city has seen a surge in new development.

Roughly 52,600 units hit the market or were under construction through the first six months of the year. There were 1,329 multifamily units under construction at the midyear point in the Spring-Tomball submarket. More than a dozen apartment developments are planned near State Highway 99, also known as Grand Parkway.

Some industry players think the trouble has just begun for multifamily in Texas, as apartment complexes are trading at steep discounts and development pipelines are starting to stagnate. It’s not all doom and gloom, however, as housing demand remains high in Texas Triangle cities, including Houston.