Capital Square Begins Construction on Multifamily Opportunity Zone Project, Fifth in Richmond, Virginia, Eighth across Southeast
April 18, 2023 | Capital Square
Capital Square, one of the nation’s leading sponsors of tax-advantaged real estate investments and an active developer of multifamily communities, announced today it has broken ground on a 352-unit, Class A multifamily development in the Scott’s Addition neighborhood of Richmond, Virginia, located within a designated qualified opportunity zone. Construction of the development is expected to be completed by Spring 2025.
“Capital Square has a track record of success in Scott’s Addition, building Class A mixed-use multifamily communities for the firm’s opportunity zone funds,” said Louis Rogers, founder and co-chief executive officer of Capital Square. “Two of the three communities known as Scott’s Collection were built, leased up, permanently financed and stabilized, all in record time with rents exceeding pro forma, while the third and final community within Scott’s Collection is currently in lease-up and performing ahead of schedule. With strong demand from qualified residents, this is an excellent time to build another exceptional Class A residential community in Scott’s Addition.”
Located at 2929 W. Clay St., 2922 W. Marshall St., and 2925 W. Marshall St., the community will include three seven-story adjoining multifamily buildings above podium parking with over 5,350 square feet of ground-level retail space. Residents will be within walking distance of arts, cultural and lifestyle amenities provided by the Scott’s Addition neighborhood, which contains over 51 retail, dining and entertainment venues.
Capital Square has been the most active developer within the Scott’s Addition neighborhood since 2020, having completed construction of three Class A multifamily communities, INK at Scott’s Collection, VIV at Scott’s Collection and GEM at Scott’s Collection, and nearing full completion of The Otis, all within walking distance of one another. In total, Capital Square will have delivered more than 900 Class A apartment homes to the community upon completion of the Marshall/Clay Street project for a total development cost exceeding $260 million.
Established in 1901, Scott’s Addition is a historic area known for its food, drink and entertainment amenities, including 13 breweries, cideries, meaderies and distilleries. Once a hub for industrial buildings and businesses, Scott’s Addition has become the number one “millennial hot spot” in Virginia, with a 43% increase in millennials in just five years, according to RENTCafe. The area is a designated opportunity zone with a census tract that stretches across Virginia Commonwealth University and the Carver neighborhood and is now known as Richmond’s fastest growing neighborhood, according to the Greater Scott’s Addition Association.
“Scott’s Addition has become the hottest neighborhood in Richmond, with heavy demand for high-quality rental housing,” said Whitson Huffman, co-chief executive officer. “It is a walkable, amenity-rich neighborhood that has attracted a growing population of affluent young renters and is among the highest performing markets in Richmond in terms of occupancy. Demand for our previous four apartment communities within Scott’s Addition has exceeded our expectations, and we expect our fifth development will perform in a similar fashion.”
Capital Square has partnered with Timmons Group as civil engineer, Poole & Poole Architecture as building architect, Hourigan Construction as general contractor, ENV as interior designer and Marvel Designs as landscape architect, all locally based firms.
Development of the project will be primarily funded with proceeds from Capital Square’s seventh qualified opportunity zone fund, CSRA Opportunity Zone Fund VII, LLC. Capital Square is an active sponsor of qualified opportunity funds and recently launched CSRA Opportunity Zone Fund VIII, LLC to fund the development of a multifamily development adjacent to the University of Tennessee’s Neyland Stadium in Knoxville. Capital Square’s opportunity zone funds have initiated almost $600 million in development value to-date.
Opportunity zones were created to stimulate long-term private investments in low-income urban and rural communities nationwide. Conceived as part of the Tax Cuts and Jobs Act of 2017, opportunity zone funds are intended to help foster economic growth by providing tax benefits to incentivize private investments in designated opportunity zones.
Since its founding in 2012, Capital Square has acquired 170 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.
About Capital Square
Capital Square is a vertically integrated 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 U.S., with eight current projects totaling approximately 2,000 apartment units with a total development cost close to $600 million. Since 2012, Capital Square has completed more than $7.5 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 six 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. In 2023, Capital Square was recognized by the Richmond Times-Dispatch as one of the region’s “Top WorkPlaces.” To learn more, visit www.CapitalSq.com.
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