Buyers to receive 100% tax abatement for 99 years in exchange for affordable restrictions.
By Jess Hardin. This article originally appeared in The Real Deal Real Estate News.
DALLAS, August 7, 2024 — The Vistria Group and Waterford Property Company have teamed up for their second mixed-income housing deal in Dallas-Fort Worth.
The partnership purchased Axis at Kessler Park, a Class A, 299-unit property at 2400 Fort Worth Avenue, for $67 million from Chicago-based real estate investor Sherman Residential, deed documents show. The price comes to more than $224,000 per unit. The partners also entered into a long-term ground lease with Dallas Housing Finance Corporation.
Freddie Mac, through Walker & Dunlop, provided a $37 million loan for the purchase. The loan represents 55 percent of the value of the property.
The terms of the sale were not disclosed, but the property was valued at $66 million in 2024, Dallas Central Appraisal District records show.
In exchange for 100 percent property tax abatement for 99 years, the buyers will immediately restrict rents for new qualified residents. The estimated taxes on the property this year were $1.5 million.
Ten percent of the 299 units will be reserved for residents who earn 60 percent of the area median income; 41 percent of units will be set aside for residents who make 80 percent AMI; and 39 percent of units will be available to residents making 140 percent AMI. The Dallas/Fort Worth area median income is about $89,000 for a family of four or $63,000 for a single person.
The property was built in 2017. It’s located about five miles west of downtown Dallas, just south of Interstate 30 — the highway that connects Dallas, Arlington and Fort Worth.
This is the second affordable housing project for Vistria and Waterford.
In partnership with Brooklyn-based real estate firm Northern Liberties, the partners purchased Domain at Midtown Park in March.
Similar to the Axis at Kessler Park deal, the buyers entered into a long-term ground lease with Dallas Housing Finance Corporation for the Domain. In exchange for a property tax abatement, the buyers restricted rents for qualified residents.
These deals show that public-private partnerships are making multifamily transactions like these possible in today’s challenging deal-making environment.
Vistria is a private investment firm with offices in Chicago, Dallas and New York.
Waterford is a Newport Beach-based real estate developer that specializes in developing mixed-use projects in California, developing and investing in affordable housing and redeveloping other commercial properties.
Dallas Housing Finance Corporation was created by the city in 1984 and provides funding — such tax-exempt mortgage revenue bonds — for the acquisition, development and redevelopment of the city’s multifamily housing.
