Megatel Homes, a Texas-based homebuilder that funds part of its operations through private placements offered by its capital markets division Megatel Capital Investment (MCI), has purchased a 29-acre parcel of land in the Dallas suburb of Mansfield to develop a $40 million residential project known as Mitchell Farms.
Mitchell Farms will include 112 single-family homes ranging in size between 1,700 square feet and 4,500 square feet which will be priced between $280,000 to $450,000.
“Despite the challenging economic climate created by the coronavirus pandemic for many real estate sectors, we’ve found residential real estate to be unwaveringly resilient in this growing market,” said Zach Ipour, co-founder. “Many of the top market analysts concur that residential real estate will likely continue to weather the storm, and recent data clearly supports this view.”
Megatel noted that industry analysts predicted a 22-percent decline in sales of new homes following the onset of the pandemic and resulting shelter-in-place and economic shutdown orders. In its most recent report on the market, however, the U.S. Census Bureau reported that new home sales increased nearly one percent in April compared to March.
For many private homebuilders, tightened lending restrictions amid the pandemic has resulted in a lack of funding, which leads to halted construction, declines in new home starts and difficulty in acquiring new land.
Ipour explained that Megatel has a solution to this challenge in the finance vertical of their company, Megatel Capital Investment. “In homebuilding, how you react during market slowdowns can change everything. We knew our focus needed to be on maintaining a strong deal pipeline. Capital from MCI afforded us the opportunity to reevaluate and renegotiate deals, without struggling to access institutional funding.”
The Mansfield suburb where the development is located is within close proximity to corporate employers, such as Bank of America, Capital One, Infosys, Southwest Airlines, Texas Instruments, and UT Southwestern Medical Center.
Megatel Homes was founded in 2006 and has completed more than 100 developments, comprised of several thousand homes, across the states of Texas and Oklahoma.