Continuing a run of high-dollar apartment deals, Henrico-based Capital Square has picked up yet another newly built complex, this time in a fast-developing pocket of Chesterfield County.
The firm known for its so-called 1031 exchanges announced it purchased the 307-unit Livingston Apartment Flats in the Cosby Village development for $86 million. The July 29 transaction had not been recorded with the county as of Wednesday.
The seller was Cosby Village Residences LLC, an entity tied to Alabama-based Liv Development, which developed the 9.3-acre property after purchasing it in 2019 for $6 million.
Whit Huffman, chief strategy and investment officer for Capital Square, said the property was appealing for its location in Cosby Village and its fast lease-up since it opened last year.
“Livingston Apartment Flats in particular was attractive because it’s a best-in-class community, it leased up exceptionally quickly, and as it stands today it’s almost 100 percent leased,” Huffman said. “We feel like there’s a strong opportunity to enhance value but also to have a really good outcome for our investors in the long term.”
Chesterfield most recently assessed the developed property at $34.35 million.
With an average rental rate of about $1,600 a month, the apartments consist of one-, two- and three-bedroom units. Community amenities include a two-story, 24-hour fitness, yoga and cross-training center; a workspace area; a conference room and offices; and a game room with pool and shuffleboard tables and a wet bar.
The property also includes a saltwater pool, cabanas and a game lawn, as well as a package room, bike repair shop, snack shop and coffee bar. Other amenities include a dog park and pet-wash station, an outdoor fire table and a car charging station.
Part of Cosby Village, the 68-acre mixed-use development driven by Midlothian-based Main Street Homes, Livingston Apartment Flats also is adjacent to a Publix grocery store and retail options that Huffman said distinguishes it from other multifamily properties in Capital Square’s portfolio.
The deal is the latest in a string of local acquisitions for Capital Square.
In June, it purchased the 192-unit Sapphire at CenterPointe on Charter Colony Parkway for $48.3 million. Late last year, the firm paid $83.75 million for the 301-unit Canopy at Ginter Park apartments in Richmond’s Northside.
It’s unloaded some properties, including the 268-unit Maple Springs Apartments for $34.8 million in April, and the firm also is actively developing its own properties, such as its three-building Scott’s Collection project in Scott’s Addition.
Founded in 2012 by Louis Rogers, Capital Square has been on that tear despite some uncertainty surrounding the 1031 exchanges it made its name on, literally. Once called Capital Square 1031, the company focuses on such exchanges through which investors can defer payments of capital gains taxes from one investment property to another.
A proposal to help fund President Joe Biden’s $1.8 trillion American Families Plan would eliminate capital gains tax breaks involving transactions with profits above $500,000. Should the proposal go forward, Rogers has said his firm has a safety net in the form of real estate investment trusts, or REITS, in which investors exchange properties through ownership shares in the REIT.
Since 2012, Capital Square has acquired 134 real estate assets for over 3,300 investors through 1031s, the company said.
In the first half of this year, Huffman said, Capital Square has completed over $500 million of acquisitions, most of those centered on housing properties such as Livingston Apartment Flats.