Lurin Capital was hit with a $40 million loan default lawsuit four months after losing 12 Florida properties to foreclosure.
Select Securities Europe, a lender from Luxembourg, filed the lawsuit, claiming Dallas-based Lurin defaulted on 15 loans totaling $40.5 million, according to the filing in U.S. District Court for the Northern District of Texas.
Lurin defaulted on the debt when it stopped paying the interest in July 2023, the lender alleged. The loans, which matured in December 2024, were personally guaranteed by Lurin co-founders Jon and Ashley Venetos.
Select Securities Europe is asking the court to require Lurin to pay the full principal, interest, late fees and attorneys’ fees. As of last month, Lurin owed $10.7 million in interest.
The lawsuit isn’t the first sign of trouble for Lurin Capital.
The multifamily investor also defaulted on $383.6 million in loans from Acore Capital Mortgage, which auctioned off the 12 properties tied to the debt. Another Lurin-owned property, the 592-unit Estates at Avenstar in Houston, hit the auction block earlier this month after the firm defaulted on a $52.5 million mortgage from Nexstar.
Lurin specializes in value-add apartment complexes, meaning it purchases older buildings with plans to renovate them, raise rents and sell for a profit. The strategy proved difficult to execute this cycle after rising interest rates made floating-rate debt and repairs a lot more expensive.
Multifamily distress is on the rise in Texas, where operators like Lurin don’t have the time or resources to hang on until interest rates are reduced.
This month, more than $700 million in CRE loans in Texas’ largest counties were flagged for foreclosure. That’s up from about $400 million in July. Most of these loans are tied to multifamily properties purchased or financed in 2021 and 2022 when values were high and debt was cheap.
Experts warn it’s just the beginning. About $19 billion in CMBS loans tied to Texas multifamily is set to mature in the next five years.
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