ExchangeRight, a sponsor of securitized 1031 exchange real estate offerings, has launched a new value-add platform with the full subscription of its Value-Add Portfolio 1 DST, a Delaware statutory trust offering.
Value-Add Portfolio 1 DST launched in August 2021 and sought to raise nearly $13.8 million from accredited investors. Proceeds from the offering were used to purchase a $23.3 million portfolio of five inline and outparcel retail properties shadow-anchored by long-term net-leased grocery tenants. The portfolio spans 136,500 square feet across four states and is shadow-anchored by GIANT, Publix, and Giant Eagle.
ExchangeRight said that the portfolio’s properties exhibit in-place cash flow beginning at 5.55 percent. The portfolio’s holdings represent an 80.7 percent occupancy based on the gross leasable area.
ExchangeRight’s strategy for the portfolio is to “create value for investors by raising occupancy through strategic leasing initiatives and tenant improvements.”
“During the economic turbulence caused by the pandemic, we discovered an opportunity to provide investors with advantageous pricing for portfolios of properties that are shadow-anchored by strong grocery tenants that feature longer-term upside potential,” said Warren Thomas, managing partner. “We have clear objectives that our asset management team is carefully executing on behalf of investors to add value in the current environment while also not compromising on the resilience and stability for which our offerings are known.”
ExchangeRight and its affiliates’ platform has more than $5.2 billion in assets under management, diversified across more than 1,100 properties totaling 21 million square feet in 47 states. The company invests in net-leased properties in the necessity-based retail and healthcare industries, as well as value-add inline and outparcel retail spaces shadow-anchored by grocery tenants.