ExchangeRight Takes DST Offering Full Cycle, Reports 160% to 163% Returns

ExchangeRight, a sponsor of securitized 1031 exchange real estate offerings, has taken its Net-Leased Portfolio 6 Delaware statutory trust offering full cycle, representing its twenty-fourth full-cycle event on behalf of investors.

According to a filing with the Securities and Exchange Commission, the private placement offering launched in April 2014 and sought to raise $18 million from accredited investors.

The proceeds were deployed to purchase a 159,400-square-foot portfolio of net-leased properties located in eight states for $34 million. Tenants include Dollar General, CVS Pharmacy, Family Dollar, AutoZone, Dollar Tree, Advance Auto Parts and Tractor Supply.

ExchangeRight provided investors with the option to perform another 1031 exchange, receive cash, complete a tax-deferred 721 exchange, or a combination of these options.

The company reported that the offering generated a 160.02 percent return on sale, including cash flow, for investors who chose to cash out or complete a 1031 exchange with their proceeds.

For investors who chose to complete a tax-deferred 721 exchange into an acquiring real estate investment trust, the portfolio generated 163.62 percent total return, including cash flow, based on an independent KPMG valuation of the acquiring portfolio as of December 31, 2021.

“Our strategy of targeting secure capital, stable income and strategic exists by creating diversified portfolios with long-term net leases to recession-resilient tenants continues to be successful…,” said Warren Thomas, a managing partner. “We look forward to continuing a healthy pace of acquisitions and aggregation of assets under management to expand our platform and optimize value for the investors who entrust us to faithfully steward their wealth.”

ExchangeRight and its affiliates’ platform includes more than $4.8 billion in assets under management across 1,050 properties totaling 19 million square feet in 44 states, as of March 31, 2022. 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.

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