Capital Square Fully Subscribes Multifamily OZ Development in Knoxville

A Knoxville, Tenn., opportunity zone offering sponsored by Capital Square has been fully subscribed. The Regulation D private placement offering – CSRA Opportunity Zone Fund VIII, LLC – raised nearly $46.7 million from accredited investors since its January 2023 launch. The OZ fund is financing the development of  a multifamily project near the University of Tennessee, Livano Knoxville, which broke ground in June 2023 and is expected to be complete in fall 2025.

“Livano Knoxville is one of the most exciting projects in Capital Square’s history,” said Louis Rogers, founder and co-chief executive officer of Capital Square, a sponsor of tax-advantaged real estate investments and an active developer and manager of housing communities. “The location of the project is unmatched – across the Tennessee River from [the] University of Tennessee’s Neyland Stadium – in a supply constrained market.”

Located at 451 W. Blount Ave., just south of the Tennessee River, Livano Knoxville is a 348-unit, Class A multifamily community. It will include studio, one-, two- and three-bedroom apartment homes averaging approximately 930 square feet. The property features 35 workforce housing units for residents who earn up to 80% of the area’s annual medium family income level.

Residents will have access to major employers, including the U.S. Department of Energy Oak Ridge National Laboratory, Covenant Health, University of Tennessee, Tennessee Valley Authority, Knox County Schools, University Health System, The Dollywood Company, Clayton Homes, DENSO Corporation, Tennova Healthcare, and Blount Memorial Hospital.

“Livano Knoxville is located next to the Great Smoky Mountains and the Tennessee River in South Knoxville, where occupancy rates are expected to stay above 95% for the next decade,” said Whitson Huffman, co-chief executive officer. “With strong occupancy rates, and rent increases expected to exceed 2.8% through 2027, the Knoxville [metropolitan statistical area] has proven to be an ideal investment market for delivering best-in-class projects to our investors.”

Knoxville is the third largest city in the state behind only Nashville and Memphis. The area is home to 18 four-year and two-year colleges and universities, led by the University of Tennessee, which has an annual enrollment of approximately 31,000 students and employs 11,700 academic and administrative employees. The university’s endowment exceeds $1.3 billion.

Capital Square is an active sponsor of qualified opportunity zone funds and recently launched CSRA Opportunity Zone Fund IX, LLC to fund the development of an approximately 320-unit, mixed-use apartment community and luxury hotel in the Scott’s Addition designated opportunity zone in Richmond, Va. Capital Square’s opportunity zone funds have initiated almost $790 million in development value to-date.

Opportunity zones were created to stimulate long-term private investments in low-income urban and rural communities nationwide. Conceived as part of the Tax Cuts and Jobs Act of 2017, opportunity zone funds are intended to help foster economic growth by providing tax benefits to incentivize private investments in designated opportunity zones.

Capital Square is a real estate firm specializing in tax-advantaged real estate investments, including Delaware statutory trusts for Section 1031 exchanges and qualified opportunity zone funds for tax deferral and exclusion. In recent years the company has become an active developer of mixed-use, multifamily properties in the southeastern United States, with eight current projects totaling over 2,000 apartment units with a total gross asset value of approximately $730 million. Since 2012, Capital Square has completed more than $7.8 billion in transaction volume.

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