ExchangeRight Essential Income 12 DST Overview
ExchangeRight Essential Income 12 DST is a Delaware statutory trust offering, sponsored by ExchangeRight Real Estate, LLC, that gives accredited 1031-exchange investors fractional beneficial ownership of a single institutional-quality industrial asset: an approximately 1,083,102-square-foot Amazon distribution center on roughly 114.2 acres at 3200 East Sawyer Road, Republic, Missouri 65738, within the Springfield metropolitan area. The building was constructed in 2021 and is 100% leased to Amazon.com Services LLC, with the lease guaranteed by Amazon.com, Inc., which carries a long-term "AA" credit rating from S&P. The Trust acquired the property on June 12, 2026 for $108,838,385 from an unaffiliated third party and is offering 100 Class 1 beneficial interests at $1,235,300 each, for a maximum offering of $123,530,000; the minimum investment is a 0.08095% interest ($100,000 of equity). The offering is structured as a 100% equity, all-cash, debt-free DST: the Trust is expressly prohibited from placing any financing on the property. Concurrent with acquisition, the Trust entered into a 20-year master lease with an ExchangeRight affiliate (Essential Income 12 Master Lessee, LLC), whose base rent is guaranteed by ExchangeRight Income Fund Operating Partnership, LP. That guaranty is the mechanism intended to deliver stable monthly income, targeted at 5.20% in year one and 5.30% in year two, during a targeted two-year hold. The distinguishing feature of the program is its exit: rather than a conventional sale, the business plan is an accelerated, tax-deferred 721 exchange in which investors' DST interests are contributed to the ExchangeRight Essential Income REIT's operating partnership for OP Units, approximately two years after the offering is fully subscribed. The Essential Income REIT is a diversified net-leased portfolio of 397 properties across 37 states backed by roughly 40 historically recession-resilient, primarily investment-grade tenants in necessity retail and healthcare, valued at more than $1.5 billion. The offering suits accredited investors completing a 1031 exchange who want passive, single-tenant net-lease income from a highly creditworthy tenant, are comfortable with illiquidity and no management control, and specifically want eventual access to a diversified REIT through the 721 aggregation strategy rather than a traditional cash sale at exit.
Highlights
The property sits at 3200 East Sawyer Road in Republic, Missouri, part of the Springfield metropolitan area in the southwest corner of the state. On approximately 114.2 acres, the site was developed as a purpose-built, modern logistics facility completed in 2021 and operates as an Amazon distribution center, an asset class tied directly to e-commerce fulfillment and regional supply-chain infrastructure. Markets like Republic offer the large contiguous acreage, highway access, and labor availability that major logistics users require, and the more than one-million-square-foot footprint reflects the scale Amazon commits to only in locations it expects to serve over the long term. Because the asset is single-tenant and net-leased, the location's value is underwritten primarily on the tenant's long-duration commitment rather than on speculative re-leasing. Investors should weigh the concentration this creates: the PPM discloses that the property is in a state susceptible to tornadoes and other natural disasters, and that new construction of competing single-tenant industrial buildings nearby could pressure demand and re-leasing prospects were Amazon ever to vacate.
The asset is an approximately 1,083,102-square-foot single-tenant industrial building constructed in 2021 and 100% leased to Amazon.com Services LLC, operating as an Amazon distribution center. The lease is guaranteed by Amazon.com, Inc., which holds an "AA" long-term S&P credit rating, placing the tenant credit near the top of the investment-grade scale and well above the BBB average of ExchangeRight's broader REIT portfolio. As part of the acquisition, the seller funded $7,482,890 into escrow for a full roof replacement ($7,190,121) and ancillary repairs, after which the property will carry a new TPO membrane roof with a 20-year warranty, meaningfully reducing near-term capital risk. The underlying Amazon lease runs through July 31, 2036, carries 1.85% annual rent increases, and includes five five-year renewal options at fair market rent. Two nuances deserve attention: the tenant lease is a double-net (NN) lease rather than fully triple-net at the tenant level, and a Phase I report identified one business environmental risk relating to potential PFAS from the site's historic agricultural use, though no recognized environmental conditions were found.
This is a 100% equity, all-cash offering, a structural feature that sets it apart from most leveraged DSTs. The Trust owns the Republic, Missouri property free and clear and is expressly prohibited under the Trust Agreement from placing any mortgage or financing on the asset, which means there is no loan-to-value, no debt-service coverage test, no balloon maturity, and no refinancing or lender-foreclosure risk at the property level. The full $123,530,000 offering is raised as owner equity, of which $112,088,036 (90.74%) represents total acquisition cost, with the balance covering the acquisition fee ($2,436,404 / 1.97%), accountable reserves for taxes, insurance, operations, and asset management ($1,318,465 / 1.07%), and selling commissions and offering expenses of $7,378,270 (5.97%, with selling commissions capped at 5.25%). Investors trading out of debt-financed relinquished property should confirm with their advisor whether an all-cash DST leaves them with mortgage "boot" to cover. Separately, the PPM discloses that the Sponsor used an equity finance arrangement (a line of credit from Ameris Bank) secured only by its own Class 2 interests to warehouse the asset; that pledge does not extend to the Trust or investors' Class 1 interests, but a Sponsor default after 18 months could adversely affect the hold period and exit.
ExchangeRight Real Estate, LLC sponsors the offering through a vertically integrated platform spanning acquisitions, financing, asset and property management, leasing, investor reporting, and dispositions. As of May 31, 2026 the firm and its affiliates report more than $7.4 billion in assets under management, diversified across over 1,400 properties and roughly 28 million square feet in 47 states, on behalf of more than 9,000 investments. The PPM states that 100% of ExchangeRight's 34 full-cycle offerings have met or exceeded their return projections, with an 8.60% average annualized total return on those full-cycle offerings, and that more than $2.5 billion of distributions, capital, and gains have been returned to investors since inception. The Trust's Manager is ExchangeRight Asset Management, LLC (formed in 2012), and day-to-day property management is handled by affiliate NLP Management, LLC; the firm's principals are Joshua Ungerecht, David Fisher, and Warren Thomas. Investors should balance this record against the PPM's own disclosures that the Manager is a recently formed entity with limited assets, owes only limited and non-fiduciary duties to owners, and that past performance does not guarantee future results.
The offering is designed for investors completing a like-kind exchange under Internal Revenue Code Section 1031. Tax counsel Venable LLP provided an opinion that the Trust should be treated as an investment (grantor) trust under Treasury Regulation 301.7701-4, so that owners are treated as holding a direct, undivided fractional interest in the real property, the treatment required for the interests to serve as 1031 replacement property, and that the master lease should be respected as a true lease. Owners receive potential tax-deferred, passive monthly income along with depreciation to shelter a portion of that income. The signature feature is the exit: after a targeted two-year hold, the plan is a tax-deferred 721 exchange contributing the DST interests into the ExchangeRight Essential Income REIT's operating partnership for OP Units, offering continued deferral, diversification across the REIT's 397-property portfolio, access to a quarterly redemption program, and estate-planning flexibility including a step-up in basis for heirs. The critical trade-off, stated plainly in the PPM: once interests are exchanged for OP Units, the investor can no longer complete a future Section 1031 exchange, and the decision to effect the 721 exchange rests solely with the Manager.
Analysis of ExchangeRight Essential Income 12 DST
Insights
Treat this as a two-year fixed-income parking structure for 1031 proceeds, not a real-estate investment: an all-cash Amazon distribution box in Republic, Missouri whose actual product is the mandated 721 roll into ExchangeRight's Essential Income REIT. The coupon is ordinary for the risk, a 5.25% average target (5.20% then 5.30%) that Meets the benchmark on current and peak income but screens Below Average on growth, honest given 1.85% escalators and a hold too short to compound. Year-one distributions are covered, barely, at 1.04x NOI, so this is real lease income, not a return of capital, backstopped by the OP's 20-year master-lease guaranty. What you pay is steep: an 8.19% total load toward the heavy end, and an offering struck at $123.5M against a $108.8M purchase and $109.4M appraisal, roughly $14.7M (~13%) over the real estate. The crux is the exit, and it is not a market: the 721 is the only way out, its timing and pricing rest solely with the affiliated Manager, and interests are absorbed at a value set to be "accretive to the REIT" rather than struck by a buyer. The part the deck buries: at ~13% above appraised value on a two-year hold, a conventional sale cannot return capital, so the 721 is not upside but the mechanism that must absorb the premium, which is exactly why it is mandatory and Manager-controlled. Against ExchangeRight's own full-cycle record, ~1.4x equity over ~5.4-year holds across 28 exits, a two-year deal returning capital plus a ~5% coupon is an income-and-diversification trade, not a wealth-builder. Own it if you are an accredited 1031 exchanger who wants institutional credit, passive income, and a defined path into a diversified REIT, and can accept illiquidity, no control, a full load, and a discretionary exit. Pass if you need appreciation, want future 1031 flexibility, or are placing IRA/tax-exempt capital, since UBTI is anticipated.
Advantages
Investment-grade tenancy: the property is 100% leased to Amazon, with the lease guaranteed by Amazon.com, Inc. at an "AA" S&P rating, near the top of the credit scale and above the BBB average of ExchangeRight's REIT. Income visibility: a 20-year master lease with base rent guaranteed by ExchangeRight's Operating Partnership supports the targeted 5.20% (year one) and 5.30% (year two) annualized distributions, paid monthly. Clean balance sheet: the offering is 100% equity and debt-free, eliminating loan-to-value, balloon, refinancing, and lender-foreclosure risk at the property level. Asset quality: a modern 2021-built, 1.08-million-square-foot logistics building on ~114.2 acres, with a new TPO roof carrying a 20-year warranty funded through a $7,482,890 seller escrow. Built-in growth and optionality: 1.85% annual rent escalations and five five-year renewal options at fair market rent. Defined exit with diversification: the targeted two-year 721 exchange is designed to move investors into a diversified $1.5 billion-plus, 397-property net-leased REIT, adding tenant, geographic, and industry diversification, a quarterly redemption program for enhanced liquidity, and estate-planning benefits. Sponsor depth: ExchangeRight reports $7.4 billion-plus AUM, 1,400-plus properties across 47 states, and 100% of its 34 full-cycle offerings meeting or exceeding projections. Accessibility and structure: a $100,000 minimum, professional third-party trustee, held reserves, and a triple-net master lease that shifts most operating expenses, taxes, and insurance to the master lessee, making this a genuinely passive, turnkey 1031 replacement property.
Concerns
Concentration: the Trust owns one asset, leased to one tenant, in one market, providing no diversification; returns depend entirely on a single Amazon facility and the continued payment of its rent. Illiquidity: there is no public market, interests are non-transferable without consent, and investors must be able to hold for an indefinite period and bear a total loss. No control: owners have no voting rights, cannot vote on a sale, cannot renegotiate the lease, and the PPM describes the DST as an "extremely inflexible" ownership vehicle managed solely by the affiliated Manager. Pricing above real estate value: the $123,530,000 offering price materially exceeds both the $108,838,385 property purchase price and the $109,400,000 appraised value, an approximately $14.7 million load, so the property would need to appreciate meaningfully just to return investor capital on a sale. Distribution risk: distributions are not guaranteed, may be reduced or suspended, and can be paid from (and deplete) reserves; the master lessee's assets are limited, so a tenant default could flow through to investors. Conflicts and reliance: the Manager, master lessee, and property manager are all ExchangeRight affiliates, agreements are not arm's-length, the Manager is recently formed with limited assets and only limited, non-fiduciary duties, and it receives fees regardless of profitability (including a 2% disposition fee). Lease and re-leasing risk: the Amazon lease is only double-net and expires in 2036, renewal options may not be exercised, and re-leasing a single-tenant building is uncertain. Exit risk: the 721 exchange is discretionary and not guaranteed, market conditions could prolong illiquidity, and the REIT could value interests below the amount invested. Tax risk: DST 1031 treatment relies on Rev. Rul. 2004-86, which the IRS could revoke; the Trust anticipates generating UBTI (adverse for IRAs); Section 467 could require recognition of phantom rental income; and after a 721 exchange or LLC conversion, future 1031 deferral is lost. Sponsor financing: an Ameris Bank equity finance arrangement could allow the pledgee to take management control upon a Sponsor default after 18 months, and a business environmental risk (potential PFAS) was flagged at the site.
ExchangeRight Essential Income 12 DST — Complete Offering Data
Offering & Structure
Investment NameExchangeRight Essential Income 12 DST
SponsorExchangeRight
StructureDelaware Statutory Trust (DST)
Offering Type506(b)
StatusLimited Availability
Last Updated2026-08-13
Size & Availability
Total Offering$123,530,000
Equity$123,530,000
DebtAll-Cash
Available Equity$12,400,093 (10% of equity)
Minimum Investment$100,000
Total Load8.19%
Initial Reserves1.07%
Property
Property TypeNet Lease
StrategyCore
LocationMO
Market TierTier 3
Income & Projections
Average Yield5.25%
Projected Yields (Y1–Y10)Y1 5.20% · Y2 5.30%
Tax-Adjusted Yield12.04%
Cap Rate Equivalent7.80%
Year 1 NOI$6,694,983
Y1 Payout Ratio1.04
Financing
In-Place LTV0.00% LTV
LenderNone (debt-free)
Interest RateN/A (no debt)
Loan TermN/A (no debt)
I/O PeriodN/A (no debt)
AmortizationN/A (no debt)
Y1 DSCRN/A - no debt service
Exit
Estimated Hold Period2 years
721 Exchange ExitMandatory
Benchmarks (vs sector median)
Avg. Income5.25% vs 5.10% market — Meets Average
Growth1.92% vs 7.54% market — Below Average
Peak5.30% vs 5.33% market — Meets 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.
