Capital Square 1031 Launches DST Offering of Texas Medical Portfolio
CORPUS CHRISTI, TX (March 19, 2020) – Capital Square 1031, a leading sponsor of Delaware statutory trust (DST) offerings, announced today the launch of CS1031 MOB TX VI, DST, a Regulation D private placement for investors seeking tax deferral under Section 1031 of the Internal Revenue Code and cash investors seeking cash flow and appreciation potential. The offering is comprised of two medical office buildings located in Corpus Christi, Texas. The buildings are leased to Covenant Physician Partners for a base term of 15 years on a triple net basis.
“Medical real estate has historically demonstrated to be a recession-resistant investment,” said Louis Rogers founder and chief executive officer. “This is Capital Square’s sixth medical DST investment in Texas for Section 1031 exchange and other investors. Texas is a preferred location for investment due to the high level of growth driving demand for additional medical services and the absence of a state income tax, creating a friendly environment for out-of-state investors.”
The portfolio includes:
• 5721 Esplanade Drive, a 9,228-square-foot, Class A multi-specialty ambulatory surgery center built in 2015 and situated on 1.08 acres of land, and
• 6002 S. Staples Street, a 24,264-sqaure-foot Class A ophthalmic clinic built in 2018 and situated on 1.501 acres of land.
“Purpose-built medical properties like Texas Eye Care are experiencing increased demand as a result of the aging population,” said Whitson Huffman, senior vice president and head of acquisitions. “Healthcare spending increased by 4.6% in 2018, which accounted for 17.7% of gross domestic product that year.* We view this acquisition as an excellent investment that capitalizes on these trends, bolstered by a 15-year triple net lease.”
Each property is operated by Covenant Physician Partners, a leading acquirer and operator of ambulatory surgery centers, anatomic pathology laboratories, anesthesia entities and physician practices. Backed by KKR & Co. Inc., a market-leading private equity firm, the company provides gastrointestinal and ophthalmic procedures through 47 ambulatory surgery centers and a variety of physician practices located across 17 states. The firm was founded in 2008 and is headquartered in Nashville, Tennessee.
Collin Hart of ERE Healthcare Real Estate Advisors represented the seller in the transaction.
Since inception, Capital Square has acquired 106 real estate assets for more than 2,000 investors nationwide seeking quality replacement properties that qualify for tax deferral under Section 1031 of the Internal Revenue Code and other investors seeing cash flow and appreciation potential.
About Capital Square 1031
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. To date, 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.
*Source: Centers for Medicare & Medicaid Services
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.