CPA Arbour Commons DST Overview
CPA Arbour Commons DST is a Regulation D, Rule 506(b) private placement offering beneficial interests in a Delaware statutory trust to accredited investors seeking replacement property for a Section 1031 exchange or making a cash investment. The Trust owns Arbour Commons Apartments, a 394-unit garden-style multifamily community at 663 W. 148th Avenue in Westminster, Colorado, within the north Denver metropolitan corridor between Denver and Boulder. The community was constructed in 2013-2014 and comprises 19 two- and three-story apartment buildings, a single-story clubhouse, and 21 detached garage buildings on approximately 28.23 acres. The Trust acquired the property on September 19, 2022 for $150,000,000 and capitalized it with $96,150,000 of equity (the maximum offering amount) and a $74,589,000 Freddie Mac loan through Arbor Agency Lending, LLC. The property is operated under a master-lease structure: it is leased to CP Arbour Commons MT, LLC, a Sponsor affiliate serving as Master Tenant, for an initial term of approximately 10 years with one five-year renewal option, while CORE Realty Holdings Management, Inc. provides on-site property management. The Sponsor, CORE Pacific Advisors, LLC, intends to preserve value, fund approximately $2,100,000 of planned interior and exterior upgrades, distribute monthly net cash flow, and sell the property before loan maturity to return capital. The minimum investment is $100,000 for exchange investors (a 0.104% interest) and $50,000 for cash investors (a 0.052% interest); Emerson Equity LLC is the managing broker-dealer. The offering suits accredited 1031 investors who want passive, non-management multifamily ownership with tax-deferral potential and who can accept illiquidity, leverage, and complete reliance on the Sponsor and its affiliates. It is unsuitable for investors who need liquidity or control over the asset.
Highlights
Arbour Commons is located at 663 W. 148th Avenue in Westminster, Colorado, part of the north Denver metropolitan area along the growth corridor between downtown Denver and Boulder. Westminster is an established suburban submarket with municipal water and sewer service and convenient regional access. The site occupies approximately 28.23 acres and includes an adjacent 0.85-acre park developed and maintained through the 144th Avenue Metropolitan Districts. The Trust obtained a third-party appraisal from CBRE, Inc. in connection with the acquisition and financing; regional, local-area and market analysis drawn from that appraisal is attached to the Memorandum as Exhibit D. Denver-metro multifamily fundamentals and the property's infill suburban position support the Sponsor's strategy of maintaining occupancy and pursuing rent growth. The Memorandum cautions, however, that appraisal data is inherently subjective, was not independently verified by the Trust, and that local population trends, competing apartment communities, and future housing supply could affect vacancy, rents, and property value over the hold period.
The property is a 2013-2014-vintage, garden-style community of 394 units across 19 two- and three-story residential buildings, complemented by a single-story clubhouse and 21 one-story detached garage buildings. Community amenities include a clubhouse, swimming pool with cabanas, fitness room, and BBQ area. Construction features include wood-frame exterior walls with stone and siding veneer, dual-pane vinyl windows, pitched composition-shingle roofs, and slab-on-grade foundations. The units were 93.14% leased as of September 14, 2022, and the property is 100% leased to the Master Tenant under the Master Lease. During the lease term the Master Tenant intends to complete approximately $2,100,000 of Planned Upgrades - full exterior re-painting and rebranding, hardscaping and landscaping, entryway and signage improvements, and refurbishment of the clubhouse, pool, cabanas, fitness room, and BBQ area - funded from Reserves and available lender-mandated capital reserves, with the goal of enhancing curb appeal, the resident experience, and rent potential across the community.
The Trust financed the acquisition with a $74,589,000 loan from Arbor Agency Lending, LLC under the Freddie Mac lending program, against a $150,000,000 purchase price - roughly 49.7% loan-to-purchase-price and moderate leverage relative to the $170,739,000 total capitalization. The loan carries a fixed interest rate of 4.20% and a 10-year term, with interest-only payments during the first six years and principal-and-interest payments on a 30-year amortization schedule thereafter, which supports early-hold cash flow. The loan is nonrecourse to investors; customary bad-boy carve-outs are guaranteed by Sponsor affiliates (Justin Morehead, Mark Osgood, John R. Saunders, and related trusts). Prepayment is permitted in the final three months of the term, with defeasance available (subject to a yield-maintenance premium) after the second anniversary of securitization. The Trust also established a $1,500,000 Trust Reserve and a $1,650,000 Working Capital Reserve, plus lender-required tax, insurance, and replacement reserves ($205,786 initial and $8,574 monthly), providing a cushion for expenses and capital needs.
The Sponsor, CORE Pacific Advisors, LLC, is a Newport Beach-based commercial real estate firm affiliated with CORE Realty Holdings Management, Inc. (CRHMI), formed in July 2005, which provides asset and property management across multifamily, office, retail, and industrial assets. The leadership team brings deep experience: CEO Justin Morehead has been involved in over $1 billion of transactions and oversees roughly 6 million square feet of commercial property; board member Mark Osgood led CMBS West Coast origination at Wachovia and has participated in over $45 billion of real estate transactions with extensive Fannie Mae, Freddie Mac, and HUD relationships; and John R. Saunders brings more than 25 years as a commercial real estate owner. The platform is supported by senior professionals in capital markets, acquisitions, finance, loan administration, and investor relations. The same team controls the Master Tenant and the Property Manager, aligning day-to-day operations, asset management, and the planned capital-improvement program under one integrated, affiliated organization with a Delaware statutory trust and tenant-in-common track record.
The offering is structured to let accredited investors acquire replacement property for a Section 1031 exchange. Special Tax Counsel Polsinelli PC has rendered a Tax Opinion that an investor's acquisition of an Interest should be treated as a direct acquisition of a real property interest for Section 1031 purposes, potentially allowing deferral of capital gains from a relinquished property. Each investor is allocated a pro rata share of the loan for exchange purposes ($77,573 per $100,000 exchange interest), which can help satisfy the replacement-debt requirement. Investors receive beneficial interests with monthly distributions of available net cash flow and, upon a sale of the property before loan maturity, a pro rata share of net proceeds after repayment of the loan - the Trust's intended exit. If a loan default forces conversion of the Trust into a Springing LLC, that transfer is generally not federally taxable under Section 721, but investors would then own membership interests rather than a direct real property interest and could not complete a further 1031 exchange on the property's disposition. The Tax Opinion is limited to Section 1031 treatment; each investor must rely on their own advisors.
Analysis of CPA Arbour Commons DST
Insights
For a 1031 exchanger, CPA Arbour Commons is best read not as an income vehicle but as a leveraged, single-asset bet on north-Denver multifamily appreciation and Sponsor execution, wrapped in a turnkey DST that can absorb both exchange equity and allocated debt on 45/180-day timelines with a Polsinelli tax opinion behind it. The relative-value math is the tell. Average projected yield runs about 3.8% against a roughly 4.9% multifamily-market average, and the offering screens Below Average on all three benchmarks tracked here - current income, peak yield, and growth - so investors accept below-market current cash flow and below-market growth. They pay a heavy price for it: total load is about 12.5%, and the $96,150,000 equity sits roughly $20,739,000 above the property's cash equity cost, pushing the going-in basis well above the $150,000,000 purchase price. Compounding the income question, the Year-1 payout ratio is about 1.08 - first-year distributions exceed first-year NOI and are therefore partly funded by financing and reserves rather than covered by property income. The fixed 4.20% Freddie Mac loan with six years of interest-only payments is a genuine strength in an elevated-rate world, front-loading distributable cash; but roughly 49.7% loan-to-purchase leverage means a balloon must be refinanced or the asset sold before the 10-year maturity, and the DST's prohibition on refinancing (absent tenant bankruptcy) funnels that into a single exit decision the Signatory Trustee controls alone. The variable the outcome hinges on is occupancy and the renovation thesis: units were 93.14% leased at acquisition while projections assume 5% vacancy, so any softening in a competitive submarket, or a shortfall in the roughly $2,100,000 renovation-driven rent premiums, would pressure distributions only partly cushioned by the $1,500,000 Trust and $1,650,000 Working Capital reserves. Watch the exit cap rate as well - with a high basis and real leverage, terminal value drives the result, and credit-market conditions at maturity could compress net proceeds. The point the marketing will not volunteer: you are paying an above-market load for below-market income and below-market growth, so the deal only works if Denver appreciation and a well-timed Sponsor sale rescue a thin going-in yield. It suits accredited investors with no liquidity needs who specifically want passive multifamily exposure, believe in Denver-metro rent growth, and trust this vertically integrated Sponsor to time a disciplined sale. It is a poor fit for anyone reaching for current income, wanting diversification or an all-cash risk profile, needing control or liquidity, or unwilling to bear affiliated-party conflicts and the tail risk of a Springing LLC conversion that would forfeit 1031 treatment.
Advantages
An investment in CPA Arbour Commons offers several offering-specific advantages. It provides a turnkey Section 1031 replacement-property solution: the property is already acquired, financed, and leased, and the Trust allocates each investor a pro rata share of nonrecourse debt to help satisfy exchange requirements, backed by a Polsinelli PC Tax Opinion supporting Section 1031 treatment. Ownership is fully passive - the master-lease structure places operations, leasing, and management with a Sponsor-affiliated Master Tenant and CORE Realty Holdings Management, relieving investors of landlord responsibilities. The underlying asset is institutional-quality: a 394-unit, 2013-2014-vintage garden-style community on 28.23 acres in the north Denver metro that was 93.14% leased at acquisition, with amenities including a clubhouse, pool, cabanas, fitness room, and garages. Financing is attractive and defensive for the early hold: a fixed 4.20% Freddie Mac loan with six years of interest-only payments and roughly 49.7% loan-to-purchase-price leverage, plus a $1,500,000 Trust Reserve and $1,650,000 Working Capital Reserve. A roughly $2,100,000 Planned Upgrade program aims to lift curb appeal, the resident experience, and rents. Investors receive monthly distributions of available net cash flow, a $100,000 exchange minimum for broad accessibility, and access to an experienced, vertically integrated sponsor team with a multifamily and DST track record and strong agency-lending relationships. The Sponsor's stated objective is to sell the property before loan maturity in a manner that maximizes return of capital to investors.
Concerns
The Memorandum describes the Interests as highly speculative, and investors should be able to bear a complete loss. Cash flow and distributions depend entirely on the Master Tenant - a newly formed Sponsor affiliate - paying Rent and successfully operating a single property; unpaid Stated Rent merely accrues at 5%. The investment is undiversified, concentrated in one Westminster, Colorado multifamily asset, so local economic conditions, new supply, and competition directly drive results. It is illiquid: there is no public market, no right of partition, and transfers require Signatory Trustee and, in some cases, lender consent. Investors hold non-voting beneficial interests with no control over operations, financing, or the timing and price of a sale, and the Trustees owe only limited duties (liability generally limited to willful misconduct or gross negligence). The DST structure imposes prohibited actions - the Trust generally cannot raise new capital, refinance, or re-lease except in narrow circumstances - so a downturn or loan default could force conversion into a Springing LLC, causing loss of Section 1031 status and possible tax consequences. Leverage adds risk: the $74,589,000 loan requires a balloon repayment or sale at maturity, and credit-market volatility could impair refinancing or sale. Fees and load are substantial - selling expenses of roughly 9.4%, a 2% ($3,000,000) acquisition fee, a $75,000 trustee fee plus a 1%-of-gross-revenue asset management fee, and Master Tenant refinancing (1%), disposition (3.75%), and construction-management (5%) fees - such that the $96,150,000 equity exceeds the property's cash cost by $20,739,000, meaning the property must appreciate materially just to recover the original investment. Conflicts of interest are pervasive (Sponsor, Master Tenant, and Property Manager are affiliates paid regardless of performance, with no formal conflict-resolution process), occupancy projections assume a 5% vacancy that may not hold, distributions may be supported by reserves, and individual 1031 qualification is not assured. Tax-exempt investors are likely to incur UBTI.
CPA Arbour Commons DST — Complete Offering Data
Offering & Structure
Investment NameCPA Arbour Commons DST
SponsorCore Pacific
StructureDelaware Statutory Trust (DST)
Offering Type506(c)
StatusConfirm Availability
Last Updated2026-07-13
Size & Availability
Total Offering$170,739,000
Equity$96,150,000
Debt$74,589,000
Available Equity$96,150,000 (100% of equity)
Minimum Investment$100,000
Total Load12.52%
Initial Reserves4.99%
Property
Property TypeMultifamily
StrategyCore
LocationCO
Market TierTier 2
Income & Projections
Average Yield3.77%
Projected Yields (Y1–Y10)Y1 3.65% · Y2 3.70% · Y3 3.80% · Y4 3.85% · Y5 3.90% · Y6 4.25% · Y7 3.25% · Y8 3.50% · Y9 3.75% · Y10 4.00%
Tax-Adjusted Yield10.49%
Cap Rate Equivalent7.80%
Year 1 NOI$6,931,522
Y1 Payout Ratio1.08
Financing
In-Place LTV43.67% LTV
LenderArbor Agency Lending / Freddie Mac
Loan TypeFixed
Interest Rate4.20% fixed
Loan Term10 years
I/O Period6 years
Amortization30 years
Y1 DSCRNot Disclosed
Exit
Estimated Hold Period10 years
721 Exchange ExitNone
Benchmarks (vs sector median)
Avg. Income3.77% vs 4.85% market — Below Average
Growth16.44% vs 24.76% market — Below Average
Peak4.25% vs 5.55% market — Below Average
Every data point Baker 1031 tracks for this offering, in one place. Figures are drawn from the offering’s private placement memorandum and sponsor materials unless noted, are summaries for convenience only, and are qualified in their entirety by the PPM. Tap the ⓘ icon next to any label for what it means and how it is calculated.
