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Capital Square Launches Medical Office DST Offering

Capital Square 1031, one of the nation’s leading sponsors of Delaware statutory trust (DST) offerings for 1031 exchange and other accredited investors, has launched a Regulation D private placement offering, CS1031 SE MOB Portfolio DST, comprised of two medical office buildings located near Memphis.

Capital Square 1031, one of the nation’s leading sponsors of Delaware statutory trust (DST) offerings for 1031 exchange and other accredited investors, has launched a Regulation D private placement offering, CS1031 SE MOB Portfolio DST, comprised of two medical office buildings located near Memphis. The offerings seeks to raise $10 million in equity from accredited investors with a minimum investment of $25,000.

“Capital Square continues to focus on medical properties for the 1031/DST program because they generate stable cash flow and capital appreciation,” said Louis Rogers, founder and chief executive officer of Capital Square. “Also, medical properties provide essential services and have proven to be recession-resistant and, now, COVID-19 resistant. With many REITs and funds on the sidelines, Capital Square is increasing its allocation to medical properties at better pricing than before the pandemic.”

CS1031 SE MOB Portfolio, DST seeks to raise $10,008,000 in equity from accredited investors with a minimum investment of $25,000.

The portfolio includes two properties in the Memphis metropolitan area within 16 miles of each other:

  • 1244 Primacy Parkway, a 16,750-square-foot, single-story medical office building situated on 1.87 acres of land in Memphis, Tennessee, and
  • 7580 Clarington Cove, a 13,156-square-foot, single-story medical office building situated on 2.023 acres of land in Southaven, Mississippi.

Each property is operated by OrthoSouth, which offers orthopedic care across eight clinic locations and two surgery centers in Tennessee, Arkansas and Mississippi. Formed by the merging of Memphis Orthopaedic Group, OrthoMemphis and Tabor Orthopedics, OrthoSouth is comprised of 35 physicians and 44 physical therapists.

“This is Capital Square’s 42nd medical property acquired since the company was founded and the first medical acquisition since the COVID-19 pandemic,” said Whitson Huffman, chief strategy and investment officer. “The lender was comforted by the strength of OrthoSouth, a top-rated medical group, and the close proximity the buildings have to leading hospitals in the area.”

Since inception, Capital Square has acquired 110 real estate assets for approximately 2,200 investors nationwide seeking quality replacement properties that qualify for tax deferral under Section 1031 of the Internal Revenue Code and other investors seeking cash flow and appreciation potential.

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