KeyCity Capital: Investors Suffer Losses on KCAP RE Funds

Investors who suffered losses in funds managed by Lasater Capital, LLC, previously known as KeyCity Capital, may have recovery options. The company, headquartered in Southlake, Texas, raised capital from accredited investors through a series of private real estate funds known as the KCAP RE funds. Those investments went on to experience “a series of catastrophic financial events,” according to a recent article, including foreclosures, court judgments, code violations, and bankruptcy filings.

Led by Chief Executive Officer Tie Lasater and Chief Financial Officer Boone Lasater, Lasater/KeyCity Capital invests in asset-backed alternative products and real estate funds. According to its website, the company holds over $300 million assets under management, encompassing 2,430 residential units and at least 750 investors. Its biggest asset is reportedly an apartment complex in Memphis, Tennessee that “was foreclosed on by Arbor Realty Trust after KeyCity defaulted on loans totaling $84.33 million.” When the complex was auctioned for a total of $42 million, investors suffered estimated losses of $30 million “based upon a projected… cost of approximately $106M” for the entire project.

The Memphis property is not the only foreclosure in KeyCity/Lasater Capital’s record. According to the above-mentioned article, a 100-unit complex in Joshua, Texas also went into foreclosure in 2025. An investor lawsuit alleges that KeyCity/Lasater Capital and its managing partner “fraudulently misrepresented the project’s financial health and their own investment record.” In one instance, an investor alleged that they suffered more than $1 million in losses on the Joshua, Texas complex, known as Joshua Landing.

A Form D document for KeyCity Capital, filed with the Securities and Exchange Commission in 2022, lists two brokers involved in selling the investments: Stephen Patterson (CRD# 5421740) and Nathaniel Goad (CRD# 7206447), both registered with J. Alden Associates’ office in Wayne, Pennsylvania. Both representatives’ BrokerCheck reports disclose pending investor complaints against them relating to investments in private placements. Mr. Patterson’s disclosure specifies that it concerns investments in funds offered by KeyCity Capital and alleges damages of more than $800,000. One of the complaints against Mr. Goad, meanwhile, alleges damages of more than $1.5 million.

Carlson Law represents investors throughout the United States in claims against financial advisors and investment firms. If you or a loved one have suffered losses on investments offered by KeyCity Capital, also known as Lasater Capital, please call us at 888-976-6111 or complete our contact form for a free and confidential consultation.