T
he Geyser Group secured a $28.5 million construction loan to build single-family homes and townhouses in East Austin's Springdale Park area. This project will be built on a 5-acre plot at 4908 Lott Avenue, which is a significant achievement considering the current challenges faced by developers in securing financing in Austin. Each unit in the 60-unit project will cost $475,000 to construct.

    The financing was arranged by Sean Borger and Garrett Newman of WelcomeLend, a tech-driven advisory firm based in Denver. Although the lender's identity was not disclosed, WelcomeLend described it as an alternative to traditional banks, allowing for higher leverage. The financing was provided at a 68% loan-to-value ratio.

    Geyser Group has already put in years of work on this project. They acquired the land in late 2020 from an entity linked to David Suissa's Lorda Corporation, as per property records. At that time, they received a $3 million loan from Keystone Bank, which was extended until June this year, according to Travis County records.

    To accommodate more units, Geyser upzoned the land to allow for 12 units per acre, up from the previous zoning of six units per acre. The company has named this project "Common Ground," which will include some affordable units. The renderings show blocky wood facades with balconies and yard space, centered around a gently curving main road.

    The new home starts in Austin have slowed significantly, with about 3,500 new homes started last month, which is roughly equal to pre-pandemic levels. This is due to the Federal Reserve raising interest rates midway through 2022, causing a boom in construction and housing prices until then. In the last year, Austin home prices have fallen about 2 percent, and they are down 17.5 percent from mid-2022, according to Redfin.

    While there's "light at the end of the tunnel" for DFW multifamily, multifamily deals are returning but Texas is lagging behind other markets for now.