Nitya Capital, the Houston syndicator that locked in a $700 million CMBS refinancing last year, is now staring down foreclosure on three North Texas apartment complexes. The properties, totaling 847 units, were slated for auction this week, exposing roughly $70 million in distress inside a portfolio that had looked buttoned up after that headline-grabbing refi. It is a sharp reminder of how quickly a leveraged multifamily deal can come apart when tax rules, aggressive underwriting, and rising rates all show up at the same party.
According to The Real Deal, foreclosure notices were filed for The Interlace Apartments, a 432-unit complex in Dallas; The Palace Apartments, a 280-unit property in Arlington; and Chaparral Apartments, with 135 units in Fort Worth. Auctions were scheduled by the lenders.
The Real Deal also reports that New York-based One William Street Capital Management provided roughly $31.4 million in financing for the Interlace, $28.2 million for the Palace, and $10.7 million for Chaparral. All in, that works out to about $83,000 of debt per unit.
Refi That Looked Like A Lifeline
In June 2025, Nitya announced a $700 million CMBS refinancing across an 18-property multifamily portfolio, a deal widely described as a major recapitalization for the firm. In a press release, the company said the securitized, fixed-rate loan, originated and securitized by Citibank, “validates the enduring strength of our portfolio.” PR Newswire carried the announcement, and MultiHousing News documented the loan structure and scope of the recapitalization.
Where The Trouble Sits
The foreclosure notices in North Texas arrive on top of other warning signs in Nitya’s home-state holdings. Last fall, a loan tied to separate Nitya assets was shifted into special servicing after a receiver was appointed, with servicer notes citing delinquencies and code issues. Outlets that monitor Morningstar Credit data and servicing transfers have summarized the tax exemption problems and servicing changes tied to that situation, and Multifamily Dive has tracked that episode and the related servicing flags.
Sale Leasebacks And State Law
The three North Texas properties now posted for foreclosure are owned by the Austin-based Texas Essential Housing Public Facility Corporation. That ownership structure followed the sale-leaseback transactions Nitya executed in June 2023, a timing that reporting notes came just weeks before House Bill 2071 tightened the rules around public facility corporations.
The Real Deal detailed the ownership setup and deal timing, while the Houston Chronicle has covered how HB 2071 pulled back tax-exempt benefits for public facility corporation deals across Texas.
What Happens At Auction
Foreclosure auctions in Texas are public sales where the highest bidder, often the noteholder, can take control of a property. Commercial foreclosure listings show the May filings that put these three complexes on the block. Industry data tracked by Roddy’s Foreclosure Listing Service flagged the Interlace, the Palace, and Chaparral in recent postings, which placed the properties on county auction calendars for bidders and servicers to track.
Local Market Take
Market observers say the Nitya situation has become a case study in what happens when syndicators lean heavily on securitized debt and tax advantaged structures during a low-rate cycle, only to get caught as conditions shift. Trade coverage has followed similar unwinds and notes that lenders, local officials, and tenant advocates are likely to watch closely to see how these auctions shake out and whether noteholders decide to hold or flip the assets. Commercial Observer and other outlets have traced the same dynamic in recent years across the Houston and broader Texas markets.
