US-based real estate firm Capital Square 1031 has acquired a 16,529-sqf data centre in La Mirada, a city within the Los Angeles metro area.
The property was acquired for CS1031 California Data Center, Delaware statutory trust (DST), a Reg. D private placement.
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.
Louis Rogers, founder and chief executive officer of Capital Square, said: “Data centres are one of the most sought-after asset classes in the nation and are rarely available for purchase.
“Capital Square is pleased to add this data centre 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.”
Capital Square’s chief strategy and investment officer Whitson Huffman, said: “The property is located in a tight industrial market, halfway between downtown Los Angeles and Orange County.
“The strategic location allows the tenant, Cogent Communications Inc., to provide fully integrated, fibre-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 centre capacity.”
Huffman added: “The global data centre 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 centres 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.