The acquisition is on behalf of a Delaware offering of statutory investment in trust which aims to increase $52.8 million in equity from accredited investors
Knoxville, Tenn., June 6, 2022 /PRNewswire/ — Capital Square, a leading national sponsor of tax-efficient real estate investments and an active developer of multi-family communities, today announced the acquisition of Village at Westland Cove, a Class A multi-family community in 240 housing units Knoxville, TN. The community was acquired in the name of CS1031 Village of Westland Cove Apartments, DST.
“This is Capital Square’s sixth acquisition of a multi-family community in Tennessee for the DST/1031 exchange program,” said Louis Roger founder and CEO of Capital Square. “Village at Westland Cove is located in one of the hottest real estate markets in the country in 2021.1 Employment in the area is exceptionally strong, with the Oak Ridge Reservation and National Laboratory, operated by the US Department of Energy, just 19 miles away, generating 14,667 full-time jobs and salaries totaling more $1.3 billion.”
Completed in 2019, Village at Westland Cove is located at 9635 Westland Cove Way along Interstate 140. The 28.2-acre luxury multi-family community sits on the shore of scenic Fort Loudoun Lake. It offers one-, two-, and three-bedroom units averaging 1,147 square feet with best-in-class amenities. Community features include a state-of-the-art fitness center, Amazon lockers and coolers for grocery deliveries, a car care center, two pet play areas, a cafe, a business, food truck evenings, a game terrace with pétanque court, outdoor fireplace, outdoor kitchen, club house, swimming pool, kayaks available to residents, as well as access to the lake via a resident dock.
Village at Westland Cove is located near The Pinnacle at Turkey Creek, a 650,000 square foot shopping center that includes over 65 retail stores and restaurants. The property is in the 10th hottest housing market in the country for 2021,1 with a 55% increase in value over 5 years, according to Zillow Group. Turkey Creek Medical Center, a Level III trauma center that is part of Tennova Healthcare, is less than two miles from the property. Further along I-140 and I-40 are attractions such as the Knoxville Art Museum, Market Square, and the Knoxville Zoo.
The Oak Ridge Reservation, operated by the US Department of Energy and home to the Oak Ridge National Laboratory, is approximately 19 miles from the village of Westland Cove and is the area’s largest employer. According to the East Tennessee Economic Council, approximately 14,667 full-time jobs were provided directly by the DOE and its major contractors within Tennessee in 2020, with annual wages and salaries totaling nearly $1.311 billion.2 WBIR.com reports that Bill Lee, from Tennessee governor, recently announced a $72 million budget for the UT-Oak Ridge Innovation Institute, a collaboration between the University of Tennessee and Oak Ridge National Laboratory, with the goal of attracting and retaining science, technology, engineering, and math (STEM) talent in the Knoxville Region.3
“Village at Westland Cove is an exceptional multi-family property located in an idyllic setting with luxury amenities throughout,” said Whitson Huffman, Chief Strategy and Investment Officer. “The local economy is thriving, with low unemployment, high average household incomes and growing demand for high-end apartments, such as those available to residents of Village at Westland Cove.”
Esri data shows that the average household income within three miles of the property is approximately $130,000. According to Yardi Matrix, from Knoxville rental rates are increasing in line with demand, with year-over-year rental growth of 18% and an average occupancy rate of 98.1% as of March 31, 2022.
The Bureau of Labor Statistics reports that Knoxville has seen an increase of over 19,000 job opportunities since February 2021, with unemployment rates reaching 2.8%. According to the BLS, employment opportunities in the region are expected to continue to grow with 3M Company announcing its intention to invest approx. $470 million to expand their manufacturing facility in MSA’s Knoxville, creating 600 new jobs by 2025.4
Taylor’s Bird, Nelson Abel, robert stickeland Alex Brown of Cushman & Wakefield represented the seller.
Bird, Executive Director of Cushman & Wakefield, said, “The Village at Westland Cove offers a truly unique asset combined with an unparalleled suite of amenities, interior finishes and beautiful water views.
CS1031 Village of Westland Cove, DST looking to increase $52.8 million in equity from accredited investors and has a minimum investment requirement of $50,000.
Since its inception in 2012, Capital Square has acquired 146 real estate assets for approximately 6,000 investors seeking quality replacement properties eligible for tax deferral under Section 1031 of the Internal Revenue Code and other investors seeking stable cash flow and capital appreciation.
Sources: 1. Nashville Business Journal, October 22, 2021 | 2. East Tennessee Economic Council, August 2021 | 3.WBIR, February 2022 | 4. US Bureau of Labor Statistics, May 2022
About Capital Square
Capital Square is a national real estate company specializing in tax-efficient real estate investments, including Delaware statutory trusts for section 1031 exchanges, opportunity zone funds qualifying for tax deferral and exclusion and a real estate investment trust (REITs). In recent years, the company has become an active developer of multi-family properties in the southeastern United States, with eight ongoing projects totaling approximately 2,000 apartments with a total development cost of more than $600 million. Since 2012, Capital Square has achieved over $5.6 billion in transaction volume. Capital Square’s management team has decades of experience in real estate investing. Capital Square 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, capital companies -investment, family offices and institutional investors. Since 2017, Capital Square has been recognized by Inc. 5000 as one of the nation’s fastest growing companies 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 has been listed by Virginia Business on their “Best Workplaces in Virginiain 2019 and their “Fantastic 50” reports in 2019 and 2020. To learn more, visit www.CapitalSq.com.
Disclaimer: Securities offered by WealthForge Securities, LLC, Member FINRA/SIPC. Capital Square and WealthForge Securities, LLC are separate entities. There are significant risks associated with investing in DST properties and real estate securities, including illiquidity, tenant vacancies, general market conditions and competition, lack of operating history, risks of interest rates, the risk of new offerings coming to market and rental rates decreasing, general risks of owning/operating commercial and multi-family properties, short-term leases associated with multi-family properties, risks financing, potential adverse tax consequences, general economic risks, development risks, long holding periods and the potential loss of all investment capital. Past performance is not indicative of future results. Potential cash flows, returns and appreciation are not guaranteed. IRC Section 1031 is a complex tax concept; consult your legal or tax advisor 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 particular attention to the risk section before investing. Diversification does not guarantee profits or protect against losses. Private placements are speculative.
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