Last week, Swapnil Agarwal reached a forbearance agreement to forestall foreclosure proceedings against three of his apartment communities, as he continues to work to keep his approximately 15,000-unit portfolio together amid financial pressure.
The three North Texas properties — The Interlace Apartments in Dallas, The Palace Apartments in Arlington and Chaparral Apartments in Fort Worth — were slated to hit the auction block on June 2, according to The Real Deal.
Agarwal, the CEO of Houston-based Nitya Capital, paid his lender, One William Street Capital Management, $1 million on June 1 to forestall the auction proceedings until June 30 at the earliest, he told Multifamily Dive. He has to add $1 million in two installments this month.
After that, Agarwal can receive monthly extensions for three additional months. However, each one costs $1 million, putting Nitya’s all-in payment to avoid foreclosure at $5 million. “I have bought myself four more months,” Agarwal told Multifamily Dive.
But he doesn’t think he’ll need that much time. Agarwal said he’s in the final stages of placing longer-term debt through Morgan Stanley on the portfolio and paying off the existing lender. “My refinance is scheduled to close this month,” he said. Morgan Stanley didn’t reply to Multifamily Dive’s request for comment.
A Roddy’s Foreclosure Listing Services’ list of properties sold at foreclosure auction on June 2 in Dallas and Tarrant Counties did not include Agarwal’s assets. His efforts to stave off the auction of his three North Texas properties are only the latest in a multiyear quest to deal with problem loans in his portfolio. Here’s how he has worked to buy time and try to pull his business back from the brink — so far.
The quest to save Texas properties
Agarwal was triaging problems in his portfolio before The Interlace Apartments, The Palace Apartments and Chaparral Apartments were slated for the auction block.
Last month, Morningstar Credit reported that the Domain at Waco and NTX Denton entered special servicing after Agarwal was unable to secure a property tax exemption due to a change in Texas law that closed the Public Financing Corporation loophole.
Agarwal was required to pay down the loan to meet a 10.33% debt yield hurdle, according to Morningstar. Agarwal said he has set up a plan to pay the lender, Argentic Real Estate Finance, in $1.5 million installments. Argentic didn’t reply to Multifamily Dive’s request for comment.
“Furthermore, Denton County has approved the exemption and Waco will follow suit right after,” Agarwal said. “If any of those exemptions come in, then no paydown is required.”
Denton County representatives did not respond to Multifamily Dive's request for comment. However, Jim Halbert, chief appraiser for the McLennan Central Appraisal District, which covers Waco, said “there is no tax exemption in place on the account for the Domain at Waco property, and we cannot confirm any agreement to that effect,” in emailed comments.
Last October, the $63.5 million loan backing Muse in Dallas and Eden Pointe in Houston entered special servicing following code violations, according to a separate Morningstar Credit report shared with Multifamily Dive. Agarwal said he’s also “close to resolution” of those issues at Muse.
“We have now addressed every single violation that was issued,” Agarwal said. “We even had a mediation with the city, and we're trying to resolve that simultaneously with Rialto [the servicer]. The loan is current. There is no back payment. As soon as the city issue is resolved, the loan will get back in good standing.”
Rialto didn’t reply to Multifamily Dive’s request for comment.
Discussions continue
Agarwal currently has 52 properties in his portfolio, including 40 conventional apartment assets, primarily across the Sun Belt, with a high concentration in Texas and Florida, he told Multifamily Dive. He has 10,000 apartments and roughly 5,000 student housing units.
He made his last conventional apartment purchase in September 2021. After the Federal Reserve began hiking rates in 2023, he realized it would be a “long marathon” to fix his portfolio.
Three years later, the process is ongoing. “With each of those assets, I have either refinanced them into a longer-term loan, already restructured the current loan with my existing lender or am in the process of refinancing some assets,” Agarwal said. “But there is not a single asset where I have given keys back to my lenders.”
For instance, after a $356 million default of 12 properties across known as the Hatteras portfolio, Agarwal secured a $700 million fixed-rate senior loan, originated and securitized by Citi, according to a company press release. Nitya added six class A student housing properties to the portfolio, located across Dallas, Indianapolis, the Carolinas, Nashville, Phoenix and Las Vegas, as it secured the June 2025 refinance.
“I also completed about $500 million in refinancings before, in 2023 and 2024,” Agarwal said. “Two-thirds of my portfolio I have refinanced into long-term [debt] through these refinancings.”
Through it all, Nitya’s CEO remains defiant, saying he is a good sponsor and is working hard to find solutions to the issues in his portfolio. He points to trimming overhead at his company, integrating artificial intelligence to improve efficiency and cutting insurance costs as ways he’s shored up his balance sheet to “make the math work.”
In addition, he’s put in his own money when necessary, including advancing more than $12 million of loans to support the three properties in North Texas and $100 million overall to support the entire portfolio, which includes deferring fees, over the last three and a half years.
“Overall, if you look at it, I haven't taken a single dollar of fees in the last four years,” he said. “I have also put in an additional $70 million of loans to support the portfolio, so that we could ride this out. We don't have a single deal that has gone bad, and that's a huge accomplishment in today's market.”
Click here to sign up to receive multifamily and apartment news like this article in your inbox every weekday.
