StoryBuilt's development pipeline for sale
The $2 billion infill development pipeline of embattled real estate firm StoryBuilt is for sale.
The commercial and residential pipeline of PSW Real Estate LLC, StoryBuilt’s legal name, consists of 28 projects across Seattle, Denver, Dallas and Austin, Texas, and is available for purchase in its entirety or separately through a receiver sale by A&G Real Estate Partners and Onyx Asset Advisors, according to an Oct. 9 announcement. The pipeline is to be sold by the end of the year, according to the asset sale website.
“StoryBuilt’s history, design skills and management talent are strong, as is its pipeline of well-conceived and located assets, but like many other builders in recent years, the company ran into capital constraints,” stated Mike Bergthold, managing director at the court-appointed receiver, Stapleton Group. “For real estate investors, this truly is a unique and rare opportunity to acquire the entire company, inclusive of assets, people and quality brand and IP or the outstanding assets individually.”
StoryBuilt co-founder Anthony Siela did not respond to a request for comment.
StoryBuilt has been dealing with mounting financial issues, including lawsuits from both investors and condo owners, more-than-100 employee layoffs and a voluntary receivership intended to fix the company’s finances.
StoryBuilt’s Lucy community at East 12th Street and Sarabeth Way, as of August 2023. Some buildings remain unfinished as the company is going through financial issues.
StoryBuilt’s pipeline consists of fully complete multifamily resident and mixed-use projects that are “generating millions of dollars in net operating income,” according to the announcement. It also includes partially and nearly complete commercial and residential projects, plus land parcels in various stages of approval. Of the projects, 17 are in Austin, five in Seattle and three each are in Denver and Dallas.
The company has a pipeline of 800 units in the Seattle area.
“Some of these sites are essentially shovel-ready, with the municipality having already reviewed and green-lighted the plans,” stated K. Kevin Otus, managing partner of Onyx Asset Advisors. “It is a major advantage for developers looking to seize opportunities in these high-demand markets.”
Of the projects, 17 are joint ventures with other entities. For instance, in 2021, StoryBuilt secured a joint partner in Switzerland-based Partners Group AG with plans to spend more than $1 billion on development.
For those joint ventures, StoryBuilt has a 10% stake and handled design and construction, according to the announcement, and those offerings include StoryBuilt’s stake in those joint ventures.
“The availability of StoryBuilt’s position in one or more of these 17 projects is an extraordinary opportunity for qualified developers,” stated Emilio Amendola, co-president of A&G Real Estate Partners. “You’re creating the opportunity to develop or complete these assets and receive substantial fees associated with things like construction, site work and construction management and supervision.”
The Josephine is a phased, 363-unit project StoryBuilt planned for 5250 Rainier Ave. S. in Seattle’s Columbia City neighborhood.
StoryBuilt often turned to joint ventures to fund projects. After the Partners Group deal, the company announced a $44 million partnership with IHP Capital Partners to develop a mixed-use community in Austin called Ellie May. At the time, Siela said the joint ventures made sense because infill development “is unique and difficult for institutions to invest in because it’s not standardized for their investment platforms.”
“We became certain that infill urban development is scalable,” Siela said in 2022. “So often, infill development is done by a local company that’s really good in a local market, and they stick to that. And that makes a lot of sense, so we had to first prove to ourselves that it’s a scalable business model. We then saw the opportunities to expand beyond just acquisition and development and homebuilding and make sure we were managing our customers and properties for life.”
Notable joint ventures include a site approved for 380 apartment units in Seattle, a partially complete townhome and single-family home development in Austin,a site approved for 55 townhomes in Denver and a development site approved for retail, condos, townhomes and apartments in Dallas, according to the announcement.
