Capital Square Launches All-Cash DST Offering for Two Texas Active-Adult Multifamily Communities

SAN ANTONIO — Capital Square has launched CS1031 Texas Active Living Portfolio II, DST, an all-cash Delaware statutory trust offering structured around two active-adult cottage communities in Texas, the firm announced June 11, 2026. The offering targets accredited investors seeking tax-advantaged real estate exposure through Section 1031 exchange replacement properties, with no mortgage debt in the capital structure.

The portfolio consists of two 32-home, single-story cottage communities — Emerald Cottages of Kerrville, located at 1501 Bandera Highway in Kerrville, and Emerald Cottages Round Rock, located at 4099 Teravista Club Drive in Round Rock. Both properties are reported at 100% occupancy with active waitlists and recorded zero bad debt and no rental concessions over the trailing 12 months.

Portfolio Properties and Occupancy Performance

Emerald Cottages of Kerrville includes 32 single-story homes purpose-built with ADA-accessible floor plans, featuring step-free entries, wide doorways and walk-in showers. Interior finishes include upgraded flooring, granite countertops, custom cabinets with tile backsplashes, stainless steel appliances and large walk-in closets. The property is adjacent to the Riverhill Country Club and Golf Course, and the Kerrville VA Medical Center is located within a five-minute drive. As of June 2026, the community is 100% occupied with a waitlist of more than 10 prospective residents and achieved 91% resident retention over the trailing 12 months.

Emerald Cottages Round Rock also includes 32 single-story ADA-accessible homes with private entrances and luxury interior finishes. The property sits within the Teravista master-planned community, which includes an 18-hole golf course, fitness centers, tennis and pickleball courts, and more than 10 miles of hiking and biking trails. As of June 2026, the community is 100% occupied with a waitlist of 10 prospective residents and achieved 81% resident retention over the trailing 12 months.

No purchase price, cap rate or square footage figures were disclosed in the announcement.

Market Rationale

"Texas continues to be one of the strongest markets in the country for active-adult housing. These communities exemplify the quality, location and demand profile we look for in active adult investments," said Louis Rogers, founder and co-chief executive officer of Capital Square. "Both properties are fully occupied with waitlists, generate stable cash flow with no debt service, and offer investors a tax-advantaged way to participate in one of the most resilient segments of the housing market."

Capital Square cited distinct market drivers for each location. Kerrville, situated in Kerr County in the Texas Hill Country, is characterized by the firm as an established retirement and recreational destination with a diversified economy anchored by healthcare, education, retail, agriculture and tourism. Major healthcare providers in the area include Peterson Regional Medical Center, Kerrville State Hospital and the Kerrville Veterans Hospital.

Round Rock, located in Williamson County within the Austin metro area and fewer than 25 miles north of downtown Austin, is positioned by the firm as offering a cost-of-living advantage relative to the broader Austin metro, supported by one of the region's lowest property tax rates. The city's economy includes major employers such as Dell Technologies, Amazon and St. David's Medical Center.

"Kerrville and Round Rock are two of the most compelling Texas markets for age-restricted housing," said Whitson Huffman, co-chief executive officer and chief investment officer of Capital Square. "Kerrville is an established Hill Country retirement destination with a diversified economy, and Round Rock offers a cost-of-living advantage relative to the broader Austin metro and one of the region's lowest property tax rates. Strong occupancy, waitlists and resident retention at both communities reinforce our conviction in well-located, differentiated active-adult housing as we seek to deliver lasting value for investors."

DST Structure and Financing Approach

The offering is structured as an all-cash real estate acquisition with no mortgage debt, a design that eliminates debt-service obligations and the financing risks typically associated with leveraged real estate investments. Delaware statutory trusts are commonly used as replacement property vehicles for investors completing Section 1031 exchanges, allowing them to defer capital gains taxes while gaining fractional ownership interests in real estate assets.

Capital Square Background

Capital Square describes itself as a vertically integrated national real estate firm specializing in tax-advantaged investments, including Delaware statutory trusts for Section 1031 exchanges, qualified opportunity zone funds and a real estate investment trust. The firm is also active as a developer and manager of multifamily communities. Since its founding in 2012, Capital Square says it has acquired more than 175 real estate assets on behalf of more than 6,500 investors and completed more than $8.9 billion in transaction volume. Its mixed-use development projects total more than 2,700 housing units with a combined development value exceeding $1 billion. Capital Square Living, the firm's property management division, oversees more than 13,000 apartments across multiple states.

Securities for the offering are offered through WealthForge Securities, LLC, Member FINRA/SIPC. Capital Square and WealthForge Securities, LLC are separate entities. The firm notes that there are material risks associated with investing in DST properties and real estate securities, including illiquidity, tenant vacancies, general market conditions, interest rate risks and the potential loss of the entire investment principal.