Capital Square Offering to Fund 238-Unit BFR Community Near Phoenix
Capital Square, a sponsor of tax-advantaged real estate investments and a national developer and manager of housing communities, announced the launch of Capital Square Blue Horizons BFR, LLC. The $24 million offering was formed to raise equity from accredited investors to support the development of a 238-unit, build-for-rent, or BFR, single-family housing community in the Phoenix suburb of Buckeye, Ariz.
Capital Square has partnered with Sunstone Two Tree as co-developer of the project. This is the second development with Sunstone Two Tree in the Phoenix area. The two companies previously developed Ironwood Homes at the Rosefield, a 320-unit BFR community on Northern Parkway road.
“Phoenix remains one of the most dynamic housing markets in the nation, driven by strong population growth, major employment expansions, and sustained demand for high-quality rental housing,” said Louis Rogers, founder and co-chief executive officer of Capital Square.
Located at the intersection of N. Jackrabbit Trail and W. Blue Horizons Parkway, the 20.86-acre development will include 88 detached villas with three- and four-bedroom floor plans, averaging 1,631 square feet, and 150 townhomes with two- and three-bedroom floor plans, averaging 1,271 square feet. Property amenities will include a clubhouse, pool and spa, fitness center, grilling pavilion, pocket parks and a playground.
Rogers continued that Blue Horizons is the latest opportunity to leverage Sunstone’s “regional expertise, vertically integrated team and proven ability to bring these communities to life, and [Capital Square’s] track record of executing tax-efficient real estate strategies for investors.”
Conveniently situated near Loop 303 and Interstate 10, the property offers direct connectivity to downtown Phoenix, Sky Harbor Airport and Arizona State University, as well as key employment hubs, shopping destinations and regional landmarks. The surrounding area is experiencing substantial economic growth, including the Taiwan Semiconductor Manufacturing Co. hub; a 27-acre Abrazo Health campus; Banner Health’s 330,000-square-foot hospital; and the 500,000-square-foot Verrado Marketplace anchored by Target, Safeway and HomeGoods.
“Phoenix continues to demonstrate exceptional fundamentals for residential investment,” said Whitson Huffman, co-CEO and chief investment officer of Capital Square. “Beyond robust population growth and developments such as the $40 billion Taiwan Semiconductor Manufacturing Company hub, the region’s expanding base in healthcare, finance, manufacturing and logistics is fostering a more diversified and stable economy that will increase demand for quality housing.”
The property is located in the Phoenix-Mesa-Chandler metropolitan statistical area, the 10th largest in the nation with more than five million residents and a median age of 38. The population has grown nearly one million since 2010 and is projected to increase an additional 250,000 by 2029, according to CBRE.
Certain investors in the fund may seek to implement a Roth IRA conversion strategy. This potentially tax-saving strategy involves investing traditional IRA dollars into a real estate development fund and, then, converting that investment into a Roth IRA during the construction of the project.
Since its founding in 2012, Capital Square has acquired more than 175 real estate assets on behalf of over 6,500 investors seeking quality replacement properties that qualify for tax deferral under Section 1031 of the Internal Revenue Code, along with others seeking stable cash flow and capital appreciation.
Since its founding in 2012, Capital Square has acquired more than 175 real estate assets on behalf of over 6,500 investors seeking quality replacement properties that qualify for tax deferral under Section 1031 of the Internal Revenue Code, along with others seeking stable cash flow and capital appreciation. In total, Capital Square has completed more than $7.9 billion in transaction volume and its mixed-used development projects total over 2,000 apartment units with a total development value in excess of $800 million. Capital Square Living, the firm’s property management division, now manages over 13,000 apartments across multiple states.
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