ExchangeRight Net-Leased All-Cash 21 DST
Investment Description
ExchangeRight Net-Leased All-Cash 21 DST is a $43.39 million, unlevered portfolio of six 100%-occupied single-tenant net-lease assets totaling approximately 222,151 square feet across Florida, Oklahoma, Massachusetts, and South Carolina. The retail component consists of Dollar Tree, Hobby Lobby, and Lowe’s; the healthcare component consists of three Novant Health urgent-care locations. The PPM identifies three NN leases and one NNN lease among the tenant agreements, with a 9.1-year weighted-average tenant lease term and 5.05% targeted Year 1 investor cash flow.
The Trust assigns tenant-lease rights and obligations to an ExchangeRight affiliate under a 20-year Master Lease. The Master Lessee pays fixed annual base rent to the Trust; ExchangeRight Income Fund Operating Partnership, LP guarantees the Master Lessee’s obligations. Exit alternatives are targeted rather than committed: investors may elect a Section 721 REIT-operating-partnership exchange, another 1031 exchange, cash-out financing plus a partial 721 exchange, a taxable cash-out, or a combination, subject to execution and REIT capital availability.
Projected Cash Flow
Highlights
Jerry Baker's Notes
Before you read these notes
Jerry Baker's Notes are his opinion, shared to help frame a conversation. They are not investment advice, a recommendation, or an offer, and they are not a substitute for the offering documents. Review the Private Placement Memorandum for complete information, including risk factors, before making any decision.
I understand · Show the notesThe underwriting is principally a platform-credit thesis rather than a conventional six-asset real-estate thesis. The Master Lessee and Manager are ExchangeRight affiliates; the PPM states the Master Lease was not negotiated at arm’s length. The Trust’s sole pre-disposition income source is fixed Master Lease rent, and the guarantor is ExchangeRight Income Fund Operating Partnership, LP. Investor cash flow therefore depends on that affiliated guarantor’s liquidity, balance-sheet capacity, and ability to fund obligations—not merely on the property-level performance of Lowe’s, Hobby Lobby, Dollar Tree, and Novant Health.
The unlevered capitalization removes interest-rate, DSCR, lender-control, and refinancing risk at the Trust level. Contractual tenant income is diversified across six assets and four states, although Lowe’s contributes 51.68% of Year 1 NOI; tenant rollover begins in 2035–2036. The PPM reports a 103.31% AFFO coverage figure for the ExchangeRight Essential Income Operating Partnership through March 31, 2026, which implies limited disclosed coverage headroom. The 20-year Master Lease improves cash-flow visibility but does not eliminate affiliate-credit, non-arm’s-length contract, capital-expenditure, valuation, or exit-execution risk. A 721 exchange is elective for investors, but its availability and economics remain dependent on REIT capital and third-party valuation.