ExchangeRight, a sponsor of securitized 1031 exchange real estate offerings, has taken its Net-Leased Portfolio 15 Delaware statutory trust offering full cycle.
The portfolio was comprised of 16 properties net leased to Walgreens, Fresenius Medical Care, Family Dollar, and Hobby Lobby.
In conjunction with the closing, ExchangeRight provided the investors in each portfolio with the option to perform another 1031 exchange, receive cash, complete a tax-deferred 721 exchange, or any combination of these options.
ExchangeRight reported annualized returns of 6.54 precent 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 the acquiring real estate investment trust, average annualized returns were equivalent to 7.99 percent based on an independent KPMG valuation of the acquiring portfolio.
According to a filing with the Securities and Exchange Commission, the private placement offering launched in early 2017 and sought to raise $27.5 million in investor equity. Other financial terms were not disclosed by the company.
The company said that it provided uninterrupted monthly distributions to investors without reducing or delaying any distribution payments throughout the offering’s four-year hold period.
“We are pleased to have once again taken a DST portfolio full cycle that generated total returns above anticipated targets,” said Warren Thomas, a managing partner of ExchangeRight. “It is gratifying to take another step in our aggregated exit strategy with this full-cycle event, serving investors in Net-Leased Portfolio 15 by preserving their capital, delivering solid returns, and providing flexible exit options to maximize investor value into the future.”
ExchangeRight and its affiliates’ platform has more than $4.3 billion in assets under management across more than 975 properties, 18 million square feet, and throughout 42 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.