10 Texas Properties with Negative Cash Flow Closed in 27 Days

Restructure First. Refinance Second.

The borrower assembled a 10-property SFR portfolio just outside the TCU campus in Fort Worth, TX. At standard 12-month market rent of $4,000/unit, the portfolio was cash-flow negative on paper.

The plan: bring on a partner with direct experience in pad splits, mid-term rentals, and rent-by-the-room in the Fort Worth market. That partner would take majority ownership, serve as personal guarantor, and unlock $6,000+/unit through creative tenancy optimization.

The refinance wasn't the goal. Restructuring the portfolio's future was.

Two Problems Most Lenders Couldn't Solve

Traditional lenders ran the rent comps and stopped there. At $4,000/month market rent, the debt service coverage didn't close. Most never got far enough to understand why a sophisticated investor would want these properties.

The second layer: a new majority partner was entering as personal guarantor. The original owner stepping to a 40% passive position and not signing loan docs raises immediate flags, especially paired with non-standard tenancy projections.

Before issuing terms, we modeled the deal the way the borrower intended to operate it, not the way a comp sheet suggested it should look. The key decision happened before a term sheet was ever issued.

"This deal came down to understanding membership interest across a partnership agreement and cash flow potential in specific submarkets. Most lenders stop at the market rent comp. We asked what the asset is actually capable of."

Jack Bergen

Work with Jack

Account Executive

Who Should Bring Us Deals Like This?

• Investors restructuring portfolio ownership — particularly where an incoming partner takes majority stake and PG responsibility.
• Borrowers in university submarkets (TCU, SEC, Big 12) with mid-term rental or rent-by-room income models traditional lenders won't underwrite.
• SFR portfolios cash-flow negative at 12-month market rent but with documented upside through creative tenancy optimization.
• Anyone told "the numbers don't work" by a lender who stopped at the comp sheet.

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Instead of refinancing just one property, the transaction evolved into a six-property portfolio refinance across New Jersey, allowing the investor to replace high-interest debt, cover closing costs, and generate new capital for future acquisitions.