Capital Square launched the CSRA Opportunity Zone Fund VIII, LLC. The project-specific opportunity zone fund will raise capital to develop Livano Knoxville, an approximately 348-unit Class-A multifamily community in Knoxville, Tennessee.
CSRA Opportunity Zone Fund VIII seeks to raise $46.684 million in equity from accredited investors.
Located in the city’s emerging South Knoxville neighborhood at 451 W. Blount Ave., just south of the Tennessee River and adjacent to the University of Tennessee’s Neyland Stadium, the multifamily community will include studio, one-, two- and three-bedroom apartment homes averaging about 930 square feet.
The property will feature 35 workforce apartment homes available to residents who earn up to 80% of the area’s annual median family income. The remainder of the available units will be market-rate apartment homes. The city of Knoxville has agreed to contribute $6.5 million of the project’s total development cost as a result of the inclusion of the workforce housing units.
Capital Square completed the acquisition of the 5.8-acre lot earlier this month and secured a $70.4 million construction loan agreement with Truist Bank. Tennessee-based Southern Building Group Inc. has been engaged as general contractor. Groundbreaking on the $116 million project, led by Capital Square’s development division and joint-venture partner, LIV Development, is scheduled to take place next month.
Major employers in the area include the U.S. Department of Energy Oak Ridge National Laboratory, Covenant Health, the University of Tennessee, Knox County Schools, University Health System, The Dollywood Company, Clayton Homes, DENSO Corporation, Tennova Healthcare, Blount Memorial Hospital and the Tennessee Valley Authority.
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.