TPEG and S2 Capital refinanced Forty200, a 512-unit, garden-style multifamily community in Mesquite, Texas that was constructed in 1983 and was formerly known as Camelot Village.
TPEG partnered with S2 Capital to acquire the property 18 months ago, in June 2015. TPEG and S2 Capital were attracted to this project because it represented an opportunity to acquire a well-located property at an attractive price per door. Camelot Village also had assumable debt in place on favorable terms. S2 and TPEG believed that renovations, mostly to unit interiors, would allow for rent increases that would significantly increase the property’s value. TPEG provided nearly $10m in preferred equity and mezzanine debt for the acquisition.
Today's refinancing returned all invested capital to investors, paid all preferred return, and provided additional profit to investors. Following the refinancing, TPEG investors had received distributions equivalent to 129% of their original investment. Those investors continue to own 50% of the property and will participate in all future distributions.