Capital Square Acquires Multifamily Community Near Huntsville for DST Offering
October 20, 2022 | Capital Square
The acquisition is on behalf of a Delaware statutory trust investment offering that seeks to raise $55.9 million in equity from accredited investors.
Capital Square, one of the nation’s leading sponsors of tax-advantaged real estate investments and an active developer of multifamily communities, announced today the acquisition of FarmHaus Apartments, a 324-unit Class A multifamily community located in the Huntsville suburb of Madison, Alabama. The community was acquired on behalf of CS1031 FarmHaus Apartments, DST, which seeks to raise $55.9 million in equity from accredited investors and has a minimum investment requirement of $50,000.
“Huntsville is the epicenter of the military defense industry,” said Louis Rogers, founder and co-chief executive officer of Capital Square. “With more PhDs and engineers per capita than any other city in the U.S., this tech-centric city is home to the nation’s second-largest research park, the U.S. Space & Rocket Center, and Redstone Arsenal that supports the national defense with large groups from the Department of Defense, Department of Justice, and NASA.1 Expanding Capital Square’s multifamily investment footprint in this stable and growing market just makes sense.”
Located at 1260 Balch Road, the 22-acre property offers open-concept one-, two-, and three-bedroom units averaging 973 square feet with top-of-the-line finishes, including stainless steel appliances, standalone kitchen islands with quartz countertops, in-unit washers and dryers, walk-in closets, keyless entry access and private patios or balconies. Community amenities include a resort style pool with large sundeck and cabanas, hot tub and spa, state-of-the-art fitness center, business center with a coffee bar, TV and gaming lounge, communal grilling station, as well as a fenced in dog park and pet spa.
FarmHaus is adjacent to the Clift Farm master development, which is home to numerous retail outlets including a 400,000-square-foot Publix. The property’s location along Highway 72 provides residents easy access to multiple job centers throughout the Huntsville area, including Redstone Arsenal, Cummings Research Park and the newly opened Mazda Toyota Manufacturing facility.
“FarmHaus Apartments is a Class A multifamily community located in an affluent part of Greater Huntsville, where population growth has exceeded 30 percent since 2000 and continues to expand at a rapid pace,” said Whitson Huffman, co-chief executive officer. “The local economy is vibrant and demand for quality rental living continues to far exceed available supply, making FarmHaus an attractive opportunity for Capital Square and the investors we serve.”
The Huntsville metropolitan statistical area has experienced a substantial 31.6% increase in population growth since 2000 and the city is projected to add 50,000 new residents by 2025.2 According to the U.S. Census Bureau, Huntsville’s population growth is the fastest in the state of Alabama and it is the most affordable city in the country, per reporting by U.S. News.3 Research by Yardi Matrix demonstrates that the median household income within a three-mile radius of FarmHaus exceeds $100,000.
Known as “Rocket City” for the development of the first rockets that put men on the moon, Huntsville is the largest city within the state of Alabama and is home to several higher education institutions, a variety of growing job industries, outdoor recreation activities, and numerous entertainment and retail options. Top industries in Huntsville include military/aerospace and defense-related businesses, as well as medical, education, aeronautics, research, telecommunications and local government.
Craig Hey and Andrew Brown with Cushman & Wakefield’s Multifamily Advisory Group represented Thompson Thrift in the transaction.
Since its founding in 2012, Capital Square has acquired 160 real estate assets for over 6,000 investors seeking quality replacement properties that qualify for tax deferral under Section 1031 of the Internal Revenue Code and other investors seeking stable cash flow and capital appreciation.
Sources:
1. https://atlantic.tech/huntsville/, 2022.
2. Cushman and Wakefield, 2020.
3. https://realestate.usnews.com/places/rankings/best-places-to-live, 2022.
About Capital Square
Capital Square is a national real estate firm specializing in tax-advantaged real estate investments, including Delaware statutory trusts for Section 1031 exchanges, qualified opportunity zone funds for tax deferral and exclusion and a real estate investment trust (REIT). In recent years the company has become an active developer of mixed-use multifamily properties in the southeastern US, with eight current projects totaling approximately 2,000 apartment units with a total development cost in excess of $600 million. Since 2012, Capital Square has completed more than $6.0 billion in transaction volume. Capital Square’s related entities provide a range of services, including due diligence, acquisition, loan sourcing, property/asset management, and disposition, for a growing number of high-net-worth investors, private equity firms, family offices and institutional investors. Since 2017, Capital Square has been recognized by Inc. 5000 as one of the fastest growing companies in the nation for four consecutive years. In 2017, 2018 and 2020, the company was also ranked on Richmond BizSense’s list of fastest growing companies. Additionally, Capital Square was listed by Virginia Business on their “Best Places to Work in Virginia” report in 2019 and their “Fantastic 50” reports in 2019 and 2020. To learn more, visit www.CapitalSq.com.
Disclaimer: Securities offered through WealthForge Securities, LLC, Member FINRA/SIPC. Capital Square and WealthForge Securities, LLC are separate entities. There are material risks associated with investing in DST properties and real estate securities including illiquidity, tenant vacancies, general market conditions and competition, lack of operating history, interest rate risks, the risk of new supply coming to market and softening rental rates, general risks of owning/operating commercial and multifamily properties, short term leases associated with multi-family properties, financing risks, potential adverse tax consequences, general economic risks, development risks, long hold periods, and potential loss of the entire investment principal. Past performance is not a guarantee of future results. Potential cash flow, returns and appreciation are not guaranteed. IRC Section 1031 is a complex tax concept; consult your legal or tax professional regarding the specifics of your particular situation. This is not a solicitation or an offer to see any securities. Please read the Private Placement Memorandum (PPM) in its entirety, paying careful attention to the risk section prior to investing. Diversification does not guarantee profits or protect against losses. Private placements are speculative.
