Capital Square Realty raises $7m for opportunity zone residential project in Richmond

The development, Scott's Collection I, is a single-structure development that will include a five-story, multifamily community with 80 units, private balconies and a lobby area. 

Capital Square Realty Advisors raised $7 million for a project-specific opportunity zone fund to develop a residential property in Richmond, Virginia. The development, Scott’s Collection I, is a single-structure development that will include a five-story, multifamily community with 80 units, private balconies and a lobby area.

Press Release

Capital Square Realty Advisors, LLC, a leading sponsor of tax-advantaged real estate investments, announced today that CSRA Opportunity Zone Fund I, LLC, a project-specific opportunity zone fund, has been fully subscribed by investors. The private placement offering raised $7 million to help develop Scott’s Collection I, a mixed-use multifamily property in the Scott’s Addition designated opportunity zone in Richmond, Virginia.

“Capital Square is gratified by the strong interest from investors in the Richmond area and nationwide,” said Louis Rogers, founder and chief executive officer of Capital Square. “Scott’s Addition is truly a national story – an industrial area that is being transformed into a highly desirable live, work and play neighborhood.”

Located at 3000 – 3008 West Clay St., Scott’s Collection I is a single-structure, ground-up development that will include a five-story, Class A multifamily community with 80 units, private balconies and a lobby area. Situated on approximately 0.54 acres of land, Scott’s Collection I will feature a 3,700-square-foot, elevated courtyard and 65-70 onsite parking spaces. The corner-lot property has unobstructed views of the Scott’s Addition neighborhood and downtown Richmond.

“This project is well-positioned to deliver attractive risk-adjusted results for our investors during a uniquely challenging period for the American economy,” said Adam Stifel, executive vice president of development. “We are pleased to do our part by providing employment opportunities in our local community when we break ground early this summer.”

Established in 1901, Scott’s Addition is a historic area that is now the City of Richmond’s fastest growing neighborhood and the second-highest performing market with an approximately 98% occupancy, according to Yardi Matrix. Scott’s Addition is a designated opportunity zone. According to Yardi Matrix, Scott’s Addition’s apartment rental rates are projected to increase 3% to 4% per year for five years between 2020 and 2024.

Opportunity zones were created to stimulate long-term private investments in low-income urban and rural communities nationwide, along with certain contiguous areas. 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.

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 and qualified opportunity zone funds for tax deferral and exclusion. Capital Square has completed approximately $1.9 billion in transaction volume. Capital Square’s executive team has decades of experience in real estate investments. Its founder, Louis Rogers, has structured hundreds of investment offerings totaling in excess of $5 billion. 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. In 2017, 2018 and 2019, Capital Square was awarded by Inc. 5000 as one of the fastest growing companies. In 2017 and 2018, the company was also ranked on Richmond BizSense’s list of fastest growing companies. In 2019, Capital Square was listed by Virginia Business on their “Best Places to Work in Virginia” and “Fantastic 50” reports. To learn more, visit www.CapitalSquare1031.com.

Disclaimer: Securities offered through WealthForge Securities, LLC, member FINRA/SIPC. Capital Square and WealthForge are not affiliated. Opportunity Zone Fund Investments involve a high degree of risk. There are risks associated with acquiring, financing, owning, constructing, leasing and operating multi-family real estate located in Richmond, Virginia. Investor Units do not represent a diversified investment because each of the Opportunity Zone Funds’ activities will be limited to the Property. Although Capital Square and its affiliates have extensive experience in acquiring, improving and operating commercial real estate, Opportunity Zone Funds and the Manager were recently organized and do not have an operating history or significant assets. Investors will rely solely on the Manager to manage a particular Fund and the Property; the Manager will have broad discretion to make decisions regarding the Property. There are substantial risks associated with developing the Property in an economically disadvantaged, qualified opportunity zone that permits investors in a Fund to qualify for available Opportunity Zone Tax Benefits. A Fund may not make capital distributions until the sale or refinancing of the Property, if at all. Real estate related investments involve substantial risks. Funds will pay substantial fees to the Manager and its affiliates (including CS Development). The Investor Units will be highly illiquid; transferability of the Investor Units is restricted and withdrawals of capital contributions are prohibited. Substantial actual and potential conflicts of interest exist among the Funds, the Manager, Capital Square, CS Development and their affiliates. An investor could lose all or a substantial portion of his investment in any of the Funds. There are tax risks associated with an investment in the Investor Units, including the possibility that government regulations regarding Opportunity Zone investments may change.