Capital Square Launches Offering to Fund Development of Single Family Build-For-Rent (BFR) Community Near Dallas
DALLAS (Jan. 23, 2023) – Capital Square, one of the nation’s leading sponsors of tax-advantaged real estate investments and an active developer of multifamily and single-family communities, announced today the launch of Capital Square Denton BFR, LLC. The LLC has been formed to raise approximately $22 million in equity from accredited investors to develop a 195-unit single family build-for-rent (BFR) community in the Dallas suburb of Denton, Texas. Capital Square has partnered with Good + West Residential and Montgomery Street Partners as co-developers on the project.
Capital Square has formed the Private Equity Group managed by experienced real estate executives, Dave Platter and Jon Trott, as managing directors and co-heads, to profit from opportunities in the housing market, including a dedicated build-for-rent strategy in high growth Texas and sunbelt markets.
“Capital Square is known for its tax-advantaged real estate offerings that provide tax deferral/exclusion, stable income and capital appreciation for thousands of investors nationwide,” said Louis Rogers, founder and co-chief executive officer of Capital Square. “Many investors and their advisors have requested additional real estate investments that generate superior risk adjusted returns in a shorter time horizon. This development LLC offering fits the bill for those investors and their advisors and is the first of many development offerings to follow.”
Located at 2205 N. Bonnie Brae Street, the 18-acre development will include a mix of one-, two- and three-bedroom single-family properties that average 1,005 square feet. Amenities will include a community pool, fitness center, business center, dog park, pavilion and pickleball court. The community will be developed and marketed under the Perch brand.
With direct access to Interstate 35 and University Drive, Denton’s primary east and west thoroughfares, residents will have direct access to downtown Denton, Frisco, McKinney, Dallas Fort Worth International Airport, Fort Worth and Dallas.
“The demand for build-for-rent living continues to grow because it offers the financial and leasing flexibility of a rental with the amenities and convenience of a professionally managed property,” said Whitson Huffman, co-chief executive officer. “Comparable build-for-rent communities in the Dallas-Fort Worth area have achieved significant rental premiums over nearby multifamily housing, which makes Denton an ideal location for Capital Square to expand its build-for-rent footprint.”
Denton experienced 12.7% rent growth in 2021 and an additional 15% growth in rent through the third quarter of 2022, according to Yardi Matrix. Home values in Denton have also risen significantly in recent years, with a 26% increase in 2022 alone, as reported by Walker and Dunlop. The city benefits from a strong and stable employment base centered around education, healthcare and manufacturing. Major employers include the University of North Texas, Denton Independent School District, Texas Women’s University, Texas Health Presbyterian Hospital Denton and Peterbilt Motors.
The planned community is in close proximity to more than a dozen shopping and dining options. The adjacent Rayzor Ranch Marketplace features Walmart, Sam’s Club and HEB. Immediately to the south is Rayzor Ranch Town Center, which contains an array of fast casual and sit-down dining options, including In-N-Out, Chipotle, Chili’s and more.
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 $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. To learn more, visit www.CapitalSq.com.
The Perch brand was developed by Good + West Residential and Montgomery Street Partners, a real estate development firm located in Austin, Texas, Good + West Residential was formed by two real estate experts, Elizabeth Good and David West. Collectively, the two partners bring more than 35 years of experience to the company. The firm focuses on multifamily and build-to-rent development in major Texas markets including Dallas, Fort Worth, and Austin.
Montgomery Street Partners is a Dallas-based diversified commercial real estate private equity firm that invests across property types and geographies. The MSP investment team has over 140 years of real estate investment experience, including over $250 billion of transactional activity and experience managing portfolios at prior financial services firms. Prior to forming MSP, MSP’s team members worked in real estate investment banking and private equity firms such as J.P. Morgan, Goldman Sachs, Harvard Management Company, RSF Partners and KeyBanc Capital Markets.
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.