With a New York City investor, Starwood Capital Group Inc. acquired a 9,500-unit portfolio of Sunbelt dwellings as part of a Chapter 11 bankruptcy auction.
Greenwich-based Starwood Capital and Gaia Real Estate Holdings L.L.C. are investing $22.5 million to acquire and recapitalize Chicago-based PJ Finance Co. L.L.C., which filed for Chapter 11 bankruptcy protection more than a year ago.
Nearly two thirds of the apartment units are in Dallas and Phoenix, with others in Texas, Florida, Georgia and Tennessee.
During the downturn the PJ Finance portfolio struggled under a heavy debt load, siphoning off capital that could otherwise have been invested in renovations to draw tenants, according to Starwood and Gaia. The companies plan to spend more than $45 million over eight years in upgrades, hiring Seattle-based Pinnacle Co. to manage the portfolio.
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