Ari Rastegar is set to lose four apartment buildings to foreclosure, but he’s not sweating it.
The Austin multifamily market is so frozen that foreclosure has become another outlet to exit a deal, he said. He sang the same tune at an event The Real Deal and his firm put on in Downtown Austin in October.
“If you can’t sell them, fucking kick the keys back,” he said.
The real estate investor and CEO of Rastegar Capital may have to do just that, as he is facing foreclosure on the four properties tied to a $22.7 million loan from Greystone, according to Roddy’s Foreclosure Listing Service. The debt works out to $139,263 per unit.
The loan is backed by Hyde Park Square, a 48-unit complex at 206 West 38th Street; Sunset Palms, a 36-unit complex at 902 Romeria Drive; The Chateau, a 30-unit complex at 1211 West 8th Street; and The Highlander, a 49-unit complex at 803-809 Tirado Street.
Rastegar said the foreclosure is the result of a “knock-down, drag-out fight with the lender,” a dispute he plans to continue litigating even if he loses the properties. He added that the properties are such a small percentage of his portfolio.
He’s focusing on the firm’s high-profile projects, like Infinity Square, a 318-acre master-planned community between Austin and San Antonio in Kyle. At full build-out, Infinity Square will have 1,000 single-family homes and 1,400 apartments. He secured a $31.7 million construction loan from Trez Capital for the project in 2024.
Rastegar also said Class C apartments in Austin have been “annihilated by the market.”
Austin has been flooded with a historic glut of multifamily deliveries in the last few years. Deliveries peaked in 2024, and Rent Cafe predicts the city will see 26,715 units delivered by the end of this year, a 5 percent drop from 2024.
The apartment oversupply has put a downward pressure on rents, which have fallen so much that it’s become the most affordable city in the country for renters, JLL’s Kai Pan said at a Texas multifamily conference this summer.
Even in the face of foreclosure, Rastegar appears to be maintaining his cool. “This is part of the business, dude.”
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