New funding partner set to help push apartment project in downtown Tacoma to completion
An apartment project near the Greater Tacoma Convention Center and University of Washington Tacoma campus has a new partner to help get it across the finish line.
Market Square Apartments, 1546 Market St., calls for 176 units and ground-floor retail in the eight-story building, and has long been on Tacoma’s lengthy list of apartment developments in planning and permitting.
On Tuesday, it gained help with funding.
Silverdale-based USG Realty Capital, an investment sponsor specializing in opportunity zone developments, on Tuesday (Feb. 14) announced Market Square Apartments “as part of its Investors Choice OZ Fund, an investor-directed, multi-asset opportunity zone fund offering.”
Opportunity zone projects offer tax advantages where investors can defer and potentially lower their capital-gains taxes in exchange for their investment.
Other apartment projects in Tacoma have turned to the program to help with financial backing. Those projects include the recent conversion of the historic Washington Building downtown, now The Astor apartments, by Seattle-based Unico Properties and Pinnacle Partners, a qualified opportunity zone investment firm.
Unico developed the project on behalf of its and Pinnacle Partners’ fund investors.
USG Realty Capital said in Tuesday’s release that its Investors Choice OZ Fund was launched in June 2021.
“Since that time, the qualified opportunity zone fund has added four more projects to its portfolio and continues to seek qualified ground-up multifamily, senior living, storage, and manufactured housing projects,” it said. “The $50 million offering focuses on projects with investment equity targets ranging from $5 million to $10 million per project.”
USG Realty Capital’s news release described the Market Square project as follows: “The luxury apartment building will include several highly desirable amenities, such as a fitness center, storage for 184 bikes, a pet grooming area, a conference room, two rooftop amenity decks, two resident lounges with kitchen and dining and five laundry facilities.”
A pre-application for a broader scale Market Square Apartments project, 1540-1548 Market St., was first filed with the city in 2019 by the previous owner, affiliated with a Florida-based LLC.
As plans took shape, the current project parcel was marketed in 2021 as “permit ready for 176 units.”
According to Tuesday’s announcement, Market Square Apartments will be developed in partnership with Bellevue-based Plus Capital Partners, with completion anticipated in June of next year. The site was purchased in July 2022 for $4.9 million.
The Tacoma project is one of five in development by Plus Capital Partners; its website shows other apartment projects in Kirkland, South Lake Union, apartment towers near Pike Place Market in Seattle, and two, 43-story office towers in Bellevue.
“When looking for our next qualified opportunity zone project to include in our portfolio, the Tacoma submarket stood out as an exceptional area that meets our strict standards,” said Greg Genovese, founder of USG Realty Capital, in a statement.
The site is next to the Koz on Market apartments, which sold along with Koz at the Dome, 304 Puyallup Ave., in September 2021 to Calida Group of Las Vegas for a combined total of around $40 million.
