Capital Square Completes UPREIT Transaction Near Atlanta with DST Investors

ATLANTA, Jan. 28, 2026 /PRNewswire/ -- Capital Square, a leading sponsor of tax-advantaged real estate investments and a national developer and manager of housing communities, today announced the contribution of Promenade at Newnan Crossing Apartments to Capital Square Housing Trust, a non-traded real estate investment trust sponsored by Capital Square.

Through an umbrella partnership real estate investment trust (UPREIT) transaction, more than 55% of the Delaware statutory trust (DST) owners (by investment value) in CS1031 Promenade at Newnan Crossing Apartments, DST, exchanged their DST interests for limited partnership units in the REIT's operating partnership in a tax-advantaged transaction under Section 721 of the Internal Revenue Code.

Promenade at Newnan Crossing was originally acquired by Capital Square in 2020 for a DST/Section 1031 exchange program. The property outperformed the private placement memorandum pro forma by more than 17% on income and nearly 30% on net operating income over a five-year holding period, supported by rent growth exceeding 25% and average occupancy above 95.5%. Many DST investors chose to retain this high-performing property and obtain other REIT benefits by participating in the UPREIT transaction.

"The DST is an exceptional structure for Section 1031 investors seeking cash flow and appreciation," said Louis Rogers, founder and co-chief executive officer of Capital Square. "Over time, many DST investors have requested a tax-favored solution that provides permanent tax deferral and greater property diversification. The DST-to-modern UPREIT transaction is the ultimate answer for a growing number of DST investors."

Unlike many UPREIT transactions, Capital Square affords investors full optionality to:

• exchange their DST interests for operating partnership units in the REIT without taxation under Section 721;
• structure another exchange to continue their tax deferral under Section 1031; or
• cash out all or a portion of their investment on a taxable basis.

Regardless of their choice, all investors are treated equally, with the same fair market value purchase price based on appraised value.

Located at 1450 Newnan Crossing Boulevard in the Atlanta suburb of Newnan, Georgia, the multifamily community is composed of 298 units and situated on 24.21 acres of land. The community's distinct unit types include townhomes, manor-style homes and garden-style apartment flats ranging in size from 577 square feet to 1,423 square feet. The community includes a resident clubhouse with multiple lounges and meeting areas, a resort-style pool, community garden, dog park, bike storage pavilion, indoor game room, bocce ball court and turf area used for outdoor movie screenings. 

The fair market value of Promenade at Newnan Crossing Apartments was established through an independent MAI appraisal. Additionally, Capital Square Housing Trust obtained a fairness opinion from Robert A. Stanger & Company, a third-party investment banking firm.

"The sale of Promenade at Newnan Crossing underscores Capital Square's strength as a vertically integrated firm and our commitment to creating attractive long-term outcomes for investors," said Whitson Huffman, co-chief executive officer and chief investment officer of Capital Square. "Investors who participated in this DST offering realized a successful total return, while those who elected to UPREIT into Capital Square Housing Trust have the opportunity for enhanced portfolio diversification, increased cash flow and other possible long-term REIT benefits not available in the DST structure."

Capital Square Housing Trust now owns 10 multifamily communities with a gross asset value of over $389 million based on purchase price. 

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 seeking stable cash flow and capital appreciation. The firm has a portfolio of 66 multifamily apartment communities, 13 age-restricted manufactured housing communities in Florida and seven build-for-rent communities, with a total investment cost of nearly $5 billion.

About Capital Square Housing Trust
Capital Square Housing Trust is a real estate investment trust sponsored by Capital Square, a national real estate firm led by a seasoned team of real estate investment professionals with decades of experience. The REIT acquires and manages a range of housing solutions in Southeastern growth markets. To learn more, please visit www.CapitalSquareREIT.com.

About Capital Square
Capital Square is a vertically integrated, national real estate firm specializing in tax-advantaged real estate investments, including Delaware statutory trusts for Section 1031 exchanges, qualified opportunity zone funds for tax deferral and exclusion, and a real estate investment trust (REIT). The company is also an active developer and manager of multifamily communities. Since 2012, Capital Square has completed more than $7.9 billion in transaction volume. Its mixed-use development projects total over 2,000 apartment units with a total development value in excess of $800 million, and Capital Square Living, the firm's property management division, oversees more than 13,000 apartments across multiple states. 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. The company has been recognized by Inc. 5000 as one of the fastest-growing private companies in the nation for nine consecutive years. Learn more at CapitalSq.com.

Disclosure
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 multifamily 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 sell any securities. Please read the Private Placement Memorandum (PPM) in its entirety, paying careful attention to the risk section prior to investing. Private placements are speculative and illiquid. Diversification does not guarantee profits or protect against losses. FINRA Broker Check link: https://brokercheck.finra.org/.

SOURCE Capital Square