Pearlstone Partners has obtained $75 million in construction financing for an upcoming 182-unit condominium development in the South Lamar area of Austin, Texas.
Knighthead Funding supplied the loan, marking the firm’s fifth transaction on behalf of Pearlstone since 2020, according to prepared remarks by Knighthead Vice President Henry Boeckmann.
Set to take shape on an 80,900-square-foot parcel at 2323 S. Lamar Blvd., 3 miles from Austin’s central business district, the five-story building will incorporate studios, one- and two-bedroom units, as well as four live work units. Additionally, the project will feature more than 6,000 square feet of street-level retail and office space. Completion is slated for the second half of 2024.
Knighthead Principal Jonathan Daniel said in a prepared statement that the influx of Fortune 500 companies relocating to Austin is attracting a consistent flow of new inhabitants, who will continue to increase the need for the type of housing that this development offers.
Recognized for its proximity to prominent culinary and entertainment establishments, South Central Austin is regarded as one of the most coveted neighborhoods within metro Austin, according to Pearlstone.
Austin’s booming residential market
A recent Yardi Matrix report indicated that, as of September 2022, the Austin metropolitan area had a particularly large multifamily pipeline, with 51,161 units underway, showcasing Central Texas’ residential development boom.
Nonetheless, there are numerous crosswinds that those involved in residential development, be it the condo market, multifamily or single-family, are now facing. The list of hurdles includes, maybe most important of all, the escalation of interest rates and inflation, which pose challenges when it comes to both development and sales.
