HPI Deer Creek DST
Investment Description
HPI Deer Creek DST was formed to acquire Xenia Trails, a 312-unit apartment community at 1600 Deer Creek Drive, Xenia, Ohio, in the Dayton-Kettering-Beavercreek MSA. The property was built in 2005/2008 and comprises 26 three-story buildings on approximately 23.286 acres, with roughly 255,339 square feet of net leasable residential area, 445 parking spaces and 148 rentable garages. Reported occupancy was 95.82% as of July 15, 2026. Total consideration is $46,000,000 ($147,436 per unit, $180 per square foot), capitalized with $27,929,065 of equity and a $25,300,000 Freddie Mac CME loan from KeyBank at 47.5% of total capitalization.
As of the Memorandum date the Trust does not own the property; it holds a binding contract to acquire it from HPI Deer Creek LLC and HPI Deer Creek Land LLC, both Sponsor affiliates, with closing anticipated on or about September 15, 2026. The Loan remains in lender underwriting and the rate will be fixed shortly before closing at the 10-year Treasury plus 92 basis points. An affiliated Master Tenant leases the property from the Trust and pays base rent plus percentage rent; the Sponsor's stated plan is to sell in approximately four to seven years and to run an interior value-add program during the hold.
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 notes[DRAFT — replace with your own view.] Two things make this different from most of the table. First, it is a pre-closing offering: as of the Memorandum date the Trust does not own Xenia Trails, closing is anticipated around September 15, 2026, the Freddie CME loan is still in lender underwriting, and the rate is not fixed until shortly before closing at the 10-year Treasury plus 92 basis points. Exhibit E models 5.42% while the insert cites 5.47% off a 4.55 Treasury; every distribution figure in the projection moves if the Treasury moves before the lock. Second, the seller is a Sponsor affiliate — HPI Deer Creek LLC and HPI Deer Creek Land LLC — so the $46 million price was not set at arm's length. I would want the appraisal before recommending it.
The 17.49% load includes a $1.15 million acquisition fee, which is 4.12% of equity and 2.5% of the purchase price, on top of 8.75% of selling, marketing and placement costs. Coverage in year four of ten is comfortable. The forecast leans on execution: Year 10 effective gross income is roughly 40% above Year 1, and the value-add income line carries a meaningful part of the yield ramp, so the back half of the distribution curve is earned rather than contracted. Full-term interest-only means no deleveraging and a $25.3 million balloon in 2036 against 2036 cap rates. The offset is the sponsor: Hamilton Point has run eight prior multifamily funds with full-cycle liquidations and stated distributions of 6.25% to 8.00%, which is a materially longer record than most DST sponsors bring.