A year after they delivered the first phase of The Stacks in Buzzard Point, Akridge and its joint partners have secured new debt for the project.
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The team has refinanced the $367M loan it secured from Bank OZK in April 2022 to build the first phase of what is expected to be a 2M SF development, D.C. deed records show.
The loan covers the three-building first phase, which delivered last year and spans 1,100 units, 40K SF of retail and 22K SF of outdoor space.
The new debt was originated by TPG Real Estate Credit Opportunities Fund, a $2.1B debt fund managed by TPG Real Estate Credit, an arm of San Francisco-based alternative asset manager TPG, which has $303B in assets under management.
A trust modification was filed Monday in the D.C. Recorder of Deeds with the TPG fund listed as the new lender with a consideration amount of $375M. The document says TPG's debt instrument is $367M, equal to the amount of the previous instrument.
TPG and Akridge declined to comment.
A spokesperson for Bank OZK said the lender “received full payoff of all principal and interest” and declined to comment further.
TPG's fund, known as TRECO, closed last year with $600M more funding than its $1.5B target.
“Early in the current cycle, we identified a compelling opportunity to invest in real estate credit at attractive risk-adjusted returns given the significant contraction in valuations and available leverage,” TPG CEO Jon Winkelried said on the company’s third-quarter earnings call in November.
He added that TPG’s clients are “expressing a growing interest in real estate, as demonstrated by the success of TRECO’s recent fundraise.” Limited partners in the fund include Ford Motor Co.'s pension fund, state of Michigan pensions and Talcott Financial Group, according to Pitchbook.
During the call, Winkelried said the TPG arm was “well positioned to play offense” in real estate.
Meanwhile, Bank OZK's real estate exposure is now down to 52% of its loan book, the company said on its first-quarter earnings call Wednesday. It is handing out fewer loans — its $1B in Q1 originations represented its slowest quarter in five years — and seeing elevated rates of loan payoffs, like Akridge's.
Akridge partnered with National Real Estate Advisors, Blue Coast Capital and Bridge Investment Group to develop The Stacks. The next phase is set to include 1,000 more units and up to two hotels, but the timeline for construction isn’t clear.
CORRECTION, APRIL 28, 10 P.M. ET: A previous version of this story misattributed one of TPG CEO Jon Winkelried’s comments to an interview rather than an earnings call. It has been corrected.
