Forman Capital, a private direct real estate lender based in Palm Beach County, Florida, funded a $19.496 million construction loan and preferred equity investment for a 64-unit townhome rental project in Taylor, Texas—part of the Austin MSA. The townhomes will provide much-needed new housing just 1.6 miles away from a $25 billion Samsung chipmaking plant that is under construction.
The borrowing entity is Castlewood Townhomes, LLC, with developer Townbridge Capital as the sponsor. The transaction closed on July 19, 2023.
Townbridge plans to construct three and four-bedroom townhomes ranging from 1,500 to 1,900 square feet. All townhomes feature detached two-car garages, quartz countertops, stainless steel appliances and durable, low-maintenance finishes. Residents will have access to smart home technology including keyless entry, video doorbells, smart thermostats, EV-charging capabilities and leak detection.
This is the first transaction between Forman Capital and Townbridge.
“It is exciting to embark on a new partnership through this transaction for Castlewood Townhomes,” said Scott Mehlman, Forman Capital’s Chief Investment Officer. “The new Samsung plant in Taylor represents a $25 billion investment which will be transformative for the submarket and create thousands of additional jobs in the years to come.”
This project is part of the Castlewood master development, which has City of Taylor approvals for a total of 239 residential lots and more than 9 acres of commercial street frontage. Townbridge previously sold most of the site to Dream Finders Homes to build for-sale homes.
Castlewood is Forman Capital’s first opportunity to bring preferred equity to a deal.
“Many traditional lenders have pulled back on real estate lending creating a financing gap for worthy projects,” said Ben Jacobson, a Forman Capital Partner. “Preferred equity can be an ideal solution to fill that gap and get a deal to the closing table.”
“We are filling a void for borrowers and taking on challenging transactions that require creativity, flexibility and extensive structuring,” Forman Capital Partner Brett Forman said. “We expect to remain extremely active in the months ahead and are aggressively targeting opportunities in the Sun Belt. Further, we value relationships and are proud that several of our borrowers are repeat clients.”
Forman Capital currently has over $650 million in its pipeline with several deals set to close over the next few weeks. Earlier this month, Forman provided a $5.5 million senior loan to finance the acquisition of a 5.5-acre residential development site in the Atlanta suburb of Lawrenceville, Georgia. In April 2023, the firm acquired a $24.1 million fully performing note secured by a 7.3-acre development site in Miami owned by an affiliate of Neology Life.
