ExchangeRight, a private real estate firm and sponsor of securitized 1031 exchange offerings, has fully subscribed its $94 million Net-Leased Portfolio 27 DST offering. The Delaware statutory trust offering launched in May 2019 and invests in properties leased to tenants operating in the necessity retail and healthcare sectors, which follows the company’s investment focus.
The offering was designed for investors seeking to participate in a 1031 tax-deferred exchange, as well as those seeking to invest in a portfolio of net-leased real estate on a cash basis. ExchangeRight’s targeted initial cash flow to investors is 6.34 percent in the first year of ownership.
Net-Leased Portfolio 27 is fully occupied and includes 18 single-tenant properties located across nine states throughout the Northeast, Midwest, and Southern regions. The company noted that the properties are backed by companies “exhibiting investment-grade metrics” including Walgreens, Hy-Vee, BioLife, and Dollar General.
The portfolio closed with 10-year, interest-only, non-recourse financing with a stated annual rate of 4.34 percent and a weighted-average lease term of approximately 14.4 years.
“In addition to completing the capital raise for Net-Leased Portfolio 27, we saw record demand for our net-leased offerings during the third quarter, with investors now trusting us to steward over $2.3 billion of assets under management,” said Warren Thomas, a managing member of ExchangeRight.
In other recent news, the company took Net-Leased Portfolio 8 DST full cycle earlier this month.
ExchangeRight is a privately held firm based in Pasadena, California, and together with its affiliates, oversees more than 600 properties located in 38 states that total more than 14 million square feet. The company sponsors real estate investment trusts and 1031 exchange investment offerings, and more than 2,700 investors have participated in their programs.