Red Oak Capital Holdings, LLC, a leading provider of private capital solutions for commercial real estate, has closed a $1.55-million bridge loan for the acquisition and lease-up of Treehouse Apartments.
Structured under Red Oak’s Opportunistic Bridge Loan Program, the non-recourse, interest-only loan features an initial term of 18 months with one six-month extension and a loan-to-stabilized-value (LTSV) of 79.49%.
Red Oak Regional Manager Nick Jans originated the loan, with underwriting by Thomas Gorski and loan administration by James Myatt. Andrew Russell, a managing director with Lument arranged the financing on behalf of the sponsor, 1400 Cherry Holdings, LLC. With a combined 41 years of multifamily investment experience, the borrower owns 14 properties totaling 1,438 units in the Dallas MSA, with an estimated market value of $157.3 million.
“With average multifamily occupancies holding above 92% and limited new supply in this submarket, Treehouse Apartments offers a solid path to stabilization,” said Nick Jans, Regional Manager at Red Oak. “The sponsor’s operating experience in the Dallas-Fort Worth area gives us confidence in their ability to complete the lease-up and transition to agency financing.”
Located at 1400 Cherry Drive, the property comprises four two-story buildings on 0.82 acres, featuring one- and two-bedroom units. The community was built in 1972 and recently underwent a comprehensive $674,000 renovation prior to sale. Improvements included exterior paint, new windows, upgraded staircases, keypad lock systems, and security cameras. Interiors were outfitted with granite countertops, tile backsplashes, stainless and black appliances, new wood vinyl flooring, and fresh paint.
At the time of closing, the property was 93.5% physically occupied but in early lease-up mode with only 12.5% economic occupancy. The loan proceeds financed the $1.65-million acquisition, and the sponsor plans to stabilize the asset before pursuing permanent financing through Freddie Mac.
“This loan reflects the type of small-balance transaction that’s often overlooked by larger lenders but still plays a vital role in housing the region’s workforce,” said Gary Bechtel, CEO of Red Oak Capital Holdings. “Treehouse Apartments combines durable location fundamentals, limited competing supply, and recent renovations that position it well for stable performance in one of the nation’s largest and most resilient multifamily markets.”
Occupancy in Central Arlington remains high, with affordable effective rental rates, making it an attractive, affordable option relative to other areas of the Dallas-Fort Worth market. Since 2019, the DFW MSA has maintained average occupancy above 92% and achieved 5.8% average annual rent growth, even as the region’s inventory has grown by more than 16.6%.
