Canada’s largest private landlord, Starlight Investments, is facing foreclosure on Emerson at Buda, a 304-unit apartment complex located at 950 FM 2001 in Buda, Texas. The property, built in 2021 and purchased by Starlight in April 2022, is set to be auctioned after the owner defaulted on a $47.7 million loan from Natixis. Mannion Auctions will conduct the sale on October 17 at 10:30 a.m.
Emerson at Buda offers amenities such as a gym, pool, cabanas, and co-working spaces. The complex is situated about 16 miles south of downtown Austin in Buda, a rapidly growing town with a population that has increased by more than eight percent since 2020.
The Austin region has experienced a significant increase in apartment supply over the past two years. This surge has contributed to declining rental rates and occupancy levels across the area. According to JLL’s Kai Pan, “Rents have fallen so much in Austin that the city leads the country in rental affordability,” as stated during a recent Texas multifamily conference hosted by Connect CRE. He noted that lower rents combined with high salaries mean Austin renters spend an average of just 16.8 percent of their income on rent.
Emerson at Buda’s rental prices have dropped notably over three years. One-bedroom apartments now start at $1,019 per month compared to $1,238 previously—a decrease of nearly 18 percent—while two-bedroom units fell from $1,598 to $1,278 per month—a reduction of 20 percent. Despite these reductions, further concessions are being offered: new renters can receive a $1,000 credit for leasing a one-bedroom unit or one month free when renting a two-bedroom unit.
Industry experts caution that financial challenges for Texas multifamily properties may continue. CWCapital’s James Shevlin said that over the next five years, approximately $19 billion in CMBS loans connected to Texas multifamily assets will mature.
