Austin Credit Union Leads $49M Multi-Family Loan

A group of seven credit unions have funded a $49 million loan to build affordable housing in Austin, Texas.

The group was led by Austin-based University Federal Credit Union ($4.1 billion, 363,885 members) in making the five-year syndicated construction loan to Journeyman Group, a real estate developer also based in Austin.

The loan deal signed May 2 is structured as a public-private partnership between Journeyman Group, Travis County Housing Finance Corporation and the credit unions.

The Journeyman Group plans to build the Matador, a 285-unit affordable multi-family project on the 3.3-acre site in south Austin and complete it by spring 2025.

Travis County Housing Finance Corporation is requiring that at least 50% of the units in the project be offered to rent for families making an average 60% of the median family income.

The Matador is the second affordable housing community developed by Journeyman Group and financed by UFCU in the Austin area. They previously built Park South, a 280-unit apartment complex in South Austin to be completed in summer 2024.

Travis County records listed Chris Turnley, UFCU’s EVP of member experience, as the contact for the lenders.

“As Austin continues to flourish and grow, housing still remains unattainable by too many working class families in our community,” Turnley said in a news release.

“At UFCU, we not only have a stated mission to advance opportunities for quality education, employment and housing, we feel there is an obligation to continuously create opportunities that benefit our members and the communities we serve,” he said.

UFCU’s news release said large multi-family loans is a sector dominated by commercial banks, but credit unions are becoming increasingly involved.

UFCU’s news release said it typically finances one or two affordable housing projects a year and anticipates continuing to finance these types of projects as a way to support the credit union’s mission.

UFCU originated no commercial real estate loans in the first quarter of this year or last, but in 2022 it produced $49.9 million, nearly triple the $17.2 million of 2021.

Among all credit unions, first-quarter commercial real estate production fell 36% to $7.8 billion. For all of 2022, it rose 40% to $51.9 billion.

The Journeyman Group has developed and built more than 200 projects at a combined cost of over $2 billion.

Chair Sam Kumar said the Journeyman Group is the largest developer in the Austin metro area and concentrates on luxury apartments. However, he said the company is “committed and devoted to bringing at least one affordable housing project per year to our community.”

The Matador will be its fifth affordable project in Austin.

“The Matador and Park South communities’ proximity to downtown, schools and jobs, place these affordable units where they are most needed for our community’s workforce,” Kumar said. “We look forward to continuing to serve the needs of our working families by bringing many more affordable projects for years to come.”