National multifamily owner and operator The Lynd Group and Declaration Partners, a private investment firm, have acquired their first distressed multifamily asset after forming a programmatic partnership in July to invest in workouts and distressed situations.
The firms, along with Corten Real Estate, purchased Augusta Flats, a recently constructed 260-unit Class A community, in San Antonio for $48 million through Lynd’s investment and acquisition division. Lynd and Declaration Partners serve as general partners, while Corten Real Estate provided joint-venture equity. In addition, Benefit Street, Lynd’s longtime debt partner, provided a loan.
The asset was acquired from the prior owner’s lender for near-par value, representing a discount from the previous trade in 2021, when the community was developed and sold during lease-up.
“Augusta Flats is an incredible property in a thriving section of the city that we closed on discount,” said A. David Lynd, CEO of The Lynd Group, which is headquartered in San Antonio. “We paid $185,000 per unit and estimate it would cost $225,000 per unit if were to build today. It is a great opportunity for our investors and an ideal fit for our portfolio.”
The community is in the historic downtown, near the River Walk and the Pearl District and within blocks of breweries, restaurants, shopping, and major employers. It comprises studio, one-, and two-bedroom floor plans with high-end finishes and spacious layouts. Residents also have access to a wealth of curated amenities, including a rooftop lounge, a resort-style pool, cabanas with grilling stations, a 24-hour fitness facility, and a golf simulator.
Augusta Flats has been incorporated into the Lynd Living management platform. New additions for residents will be wellness, home, and pet services; monthly events with a DJ; food truck gatherings; sound healing classes; educational workshops; and movie nights.
“Properties like Augusta Flats are the kind of deals in our sweet spot,” said Constantine Scurtis, chief investment officer at Lynd, which now owns and manages approximately 1,500 units in greater San Antonio. “We are seeing a lot of distress in the multifamily market and feel like our partnership is ideally positioned to get a first look at some of these over-levered properties. We have the resources to close quickly and the operational experience to breathe new life into these assets.”
According to the firms, the partnership is advising on several multifamily portfolios involving 23,000 units.
“Declaration is very pleased to close our first transaction together as general partners,” added partner Ron Dalal. “With Lynd’s operational expertise and insightful market knowledge, we anticipate this will be a very successful investment.”
