Home Service company Company behind Park West apartments set to default on nearly $7 million in debt

Company behind Park West apartments set to default on nearly $7 million in debt

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COLLEGE STATION, Texas (KBTX) – The company behind Park West – Texas A&M University is in financial trouble. NCCD-College Station Properties LLC is set to default on nearly $7 million in debt on Friday.

NCCD – College Station Properties LLC is a separate entity from the National Campus and Community Development Corporation (NCCD). According to the NCCD website, it manages the financing team of its entities through negotiations, closing and financing.

According to Moody’s Investor’s Service, the company was due to pay $15.265 million in principal and interest, but only paid $8.5 million. Moody’s said this is due to an oversaturated student housing market that has made it difficult to pay bond debt.

NCCD also retains ownership responsibilities throughout the financing of the entity. These responsibilities include overseeing property managers and their budgets and operations. In addition, the NCCD oversees communication with federal and state regulatory bond entities and bondholders, as well as tax filings, audits, and assurances.

The Securities and Exchange Commission compares bond debt to an IOU. According to the SEC, “Investors who buy corporate bonds lend money to the company issuing the bond. In return, the company legally undertakes to pay interest on the principal and, in most cases, to return the principal when the bond matures or matures.

When a company defaults on a bond, its solvency becomes a concern for bondholders. Experts say the process can be complicated for properties in default, including an increased risk that they will be sold at a loss to appease creditors.

Park West is a public-private partnership, meaning Texas A&M owns the land the complex sits on, but the university has no financial involvement in the deal. KBTX reached out to Texas A&M and the Texas A&M University System for comment, but no one was available due to Independence Day weekend.

National campus and community development also gave rise to the Texas A&M Hotel and its parking lot. These developments are separate projects and should not be affected by the defect.

For more details on the default, click here.

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