Firm acquires data center for a DST investment offering that seeks to raise $5.026 million in equity from accredited investors.
LOS ANGELES (Feb. 11, 2021) Capital Square 1031, a leading sponsor of Delaware statutory trust (DST) offerings for 1031 exchange and other accredited investors, announced today the acquisition of a 16,529-square-foot, all-purpose data center in La Mirada, a city within the Los Angeles metro area. The property was acquired for CS1031 California Data Center, DST, a Reg. D private placement.
“Data centers are one of the most sought-after asset classes in the nation and are rarely available for purchase,” said Louis Rogers, founder and chief executive officer of Capital Square. “Capital Square is pleased to add this data center to its diversified portfolio of Class A and B multifamily properties, manufactured housing communities, medical office buildings, office/headquarters, and industrial properties for Section 1031 and other investors nationwide.”
Located at 16680 Valley View Ave., the property is occupied by Cogent Communications Inc., one of the world’s largest internet service providers. The company delivers internet, ethernet and colocation services to over 88,100 customers in more than 207 markets and 47 countries across the globe.
“The property is located in a tight industrial market, halfway between downtown Los Angeles and Orange County,” said Whitson Huffman, chief strategy and investment officer. “The strategic location allows the tenant, Cogent Communications Inc., to provide fully integrated, fiber-optic network services to its significant customer base in the metropolitan area, without reliance on third-party carriers. Growing data usage trends, such as the Internet of Things (IoT), big data and cloud computing, continue to drive demand for greater data center capacity.”
Situated on 1.77 acres of land, the property has more than 13 years remaining on its double-net lease with annual rental increases of 3% through the initial term, and two five-year renewal options thereafter.
CS1031 California Data Center, DST seeks to raise $5.026 million in equity from accredited investors and has a minimum investment of $50,000.
Huffman added, “The global data center infrastructure market is projected to reach a total market size of $230.2 billion in 2025, up from $155.2 billion in 2019. One of nine Cogent Communications data centers in the western United States, this property is essential for routing high-speed internet traffic into and out of Greater Los Angeles and throughout the Southwestern United States.”
Jeffrey Jackson, first vice president, CBRE Capital Markets, represented the seller in the transaction, while Capital Square represented itself.
Since the company was founded, Capital Square has acquired 123 real estate assets for over 2,700 investors seeking quality replacement properties that qualify for tax deferral under Section 1031 of the Internal Revenue Code and other investors seeking stable cash flow and capital appreciation.
About Capital Square
Capital Square is a national 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. Since 2012, Capital Square has completed more than $2.6 billion in transaction volume. Capital Square’s executive team has decades of experience in real estate investments. Its founder, Louis Rogers, has structured hundreds of investment offerings totaling in excess of $5 billion. Capital Square’s related entities provide a range of services, including due diligence, acquisition, loan sourcing, property/asset management, and disposition, for a growing number of high net worth investors, private equity firms, family offices and institutional investors. Since 2017, Capital Square has been recognized by Inc. 5000 as one of the fastest growing companies in the nation for four consecutive years. In 2017, 2018 and 2020, the company was also ranked on Richmond BizSense’s list of fastest growing companies. Additionally, Capital Square was listed by Virginia Business on their “Best Places to Work in Virginia” report in 2019 and their “Fantastic 50” reports in 2019 and 2020. To learn more, visit www.CapitalSquare1031.com.
Disclaimer: Securities offered through WealthForge Securities, LLC, Member FINRA/SIPC. Capital Square and WealthForge Securities, LLC are separate entities. There are material risks associated with investing in DST properties and real estate securities including illiquidity, tenant vacancies, general market conditions and competition, lack of operating history, interest rate risks, the risk of new supply coming to market and softening rental rates, general risks of owning/operating commercial and multifamily properties, short term leases associated with multi-family properties, financing risks, potential adverse tax consequences, general economic risks, development risks, long hold periods, and potential loss of the entire investment principal. Past performance is not a guarantee of future results. Potential cash flow, returns and appreciation are not guaranteed. IRC Section 1031 is a complex tax concept; consult your legal or tax professional regarding the specifics of your particular situation. This is not a solicitation or an offer to see any securities. Please read the Private Placement Memorandum (PPM) in its entirety, paying careful attention to the risk section prior to investing. Diversification does not guarantee profits or protect against losses.