Capital Square 1031 LLC, a sponsor of replacement property for Section 1031 exchanges, has purchased a 10,880-square-foot medical building in Kinston, North Carolina.
The building is 100 percent leased to Bio-Medical Applications of North Carolina, an affiliate of Fresenius Medicare Care, a leading provider of dialysis services and products for people with chronic kidney failure. Fresenius has 61 dialysis clinics in North Carolina and 2,249 clinics in North America.
“This flagship location is one of Fresenius’ largest dialysis clinics in North Carolina, with 39 service chairs and approximately 110 patients. Kinston is a prime location, adjacent to the doctor’s office and only a five-minute drive to the hospital,” said Louis Rogers, founder and chief executive officer of Capital Square 1031. “Having the clinic, doctor’s office and hospital in close proximity makes Kinston convenient for patients and their care givers and efficient for health care providers.”
“Chronic kidney failure is approaching epidemic proportions, which is driving the demand for dialysis clinics,” Rogers added. “There is no alternative to dialysis for most patients with diabetes or other forms of chronic kidney failure and, regrettably, there is no cure for the disease. Because most patients are covered by medical insurance or Medicare, dialysis clinics have proven to be stable, recession-resistant investments.”
Rogers further observed that North Carolina is a Certificate of Need state, which creates a barrier to entry for competing dialysis providers and also makes it more difficult for a provider to leave an existing location because consent would be required from the state’s Division of Health Services Regulation.
Capital Square acquired the Kinston property in an all-cash purchase (no debt) primarily for Section 1031 exchange investors.
Capital Square 1031 is a national real estate investment and management company. The firm sponsors institutional-quality real estate exchange programs that qualify for tax deferral under Section 1031 of the Internal Revenue Code. Capital Square uses the Delaware Statutory Trust (DST) structure to make quality real estate available to a larger number of investors. Capital Square provides a range of services, including due diligence, acquisition, loan sourcing, property management/asset management, and disposition, for a growing number of high net worth investors, private equity firms, family offices and institutional investors. As of November 2nd, Capital Square oversees a national portfolio of 56 real estate assets valued at approximately $564 million, based on investment cost.