Bonaventure Launches $32M DST for Richmond Senior Living Community
Bonaventure launched a $32 million Delaware statutory trust offering last month that gives 1031 exchange investors fractional ownership of Aspire West End, a 148-unit independent living community in Richmond, Va., that the firm developed in 2018 and has operated since, the company said.
The Aspire West End DST is Bonaventure’s fourth DST offering in 16 months. Together, the firm’s three earlier DSTs – for Virginia properties in Alexandria, Manassas, and Norfolk – raised about $66 million in equity. Each was fully subscribed and is paying distributions, Bonaventure said.
For Aspire, beneficial interests are available to accredited investors with a $100,000 minimum investment through member broker-dealers and registered investment advisers. Preferred Capital Securities is the managing dealer.
Bonaventure is pitching its history with the property as the main reason to invest. “Most DST sponsors meet a property at the same time their investors do,” said Dwight Dunton, Bonaventure’s founder and chief executive officer. “We already know the building, the systems, the leases, and the operating costs.”
That history also makes the deal a related-party transaction: Bonaventure is contributing a property it owns to a trust it sponsors. The company said the offering price is supported by independent third-party appraisals, which are summarized in the private placement memorandum available to prospective investors.
Bonaventure said it is selling now because the investment that owned the property has reached the end of its target hold period, and the sale unlocks that investment’s equity so it can be distributed to its investors.
The firm declined to disclose its cost basis in the property. It also declined to disclose debt, fees, projected distributions, average rents, or when the property reached stabilization and referred investors to the PPM for offering terms.
The property is master leased to a wholly owned Bonaventure subsidiary for the life of the DST. Bonaventure keeps any unsold interests until the offering is fully subscribed.
Bonaventure said independent living sits low on the senior housing acuity scale. Most of its revenue comes from rent, similar to conventional multifamily and active adult properties, with some added operating work because of food and beverage service.
Potential 721 Exchange Into BMIT
The target hold period is about two to five years. Investors will have an optional tax-deferred 721 exchange into Bonaventure Multifamily Income Trust, a nontraded real estate investment trust sponsored by Bonaventure. BMIT can also decline the exchange, the company said.
Aspire West End has 112 one-bedroom and 36 two-bedroom units, averaging 892 square feet. It is in Henrico County’s West End submarket and was 91.9% occupied as of Sept. 9, the company said.
Bonaventure said about 19,600 residents aged 75 or older live within five miles of the property, and it projects that western Henrico County’s population aged 75 or older will grow by more than 21% over the next five years. The firm also said recent senior housing deliveries in the Richmond market have been income-restricted or entrance-fee continuing care communities that don’t compete directly with Aspire West End.
“Aspire West End combines those favorable market dynamics with a property we have operated for years, giving investors the benefit of both a strong location and an established operating platform,” said Casey MacMaster, senior vice president of investments and portfolio manager of BMIT.
Bonaventure describes itself as an operator-led real estate investment firm specializing in multifamily assets across the Mid-Atlantic and Southeast regions, with $2.9 billion in assets under management. The company also said it owns seven senior housing properties with nearly 1,000 units.
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