Urban Catalyst Launches First DST

Urban Catalyst Funds acquired Industrial Fund I, a single-tenant, 44,765-square-foot building seven miles from downtown Dallas.

Urban Catalyst, a sponsor of opportunity zone funds, has launched Industrial Fund I, its first Delaware statutory trust offering that would allow investors to invest in an industrial property in Dallas.

Industrial Fund I owns a single-tenant, 44,765-square-foot industrial building seven miles from downtown Dallas.

Built in 1976 and renovated in 2021, it has a long-term net lease with built-in rent increases.

“DSTs are a natural evolution for us,” said Erik Hayden, founder and chief executive officer of Urban Catalyst. “They share many similarities with our existing funds including the need for high-quality professional real estate asset selection and management, and the potential for investors to defer capital gains taxes.”

The company says that annual rents among Dallas-area industrial properties are expected to rise by double digits through the second quarter of 2023, outpacing the national average.

“The Texas economy has been growing strongly and the Dallas—Fort Worth market has seen significant demand for Industrial properties driven by ecommerce, manufacturing and logistics,” said Pisoot Senethavilay, director of strategic partnerships at Urban Catalyst Funds. “It’s a great place for the launch of our first DST fund.”

Urban Catalyst is a real estate equity fund manager and development company that has focused on ground-up projects in downtown San Jose, California. The company’s first opportunity zone fund, Urban Catalyst Opportunity Fund I, closed in December 2020 after raising $131 million.

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