PG St. Louis Industrial DST Overview
PG St. Louis Industrial DST is a Regulation D, Rule 506(c) all-cash (debt-free) offering of up to $23,444,592 in beneficial interests in a newly formed Delaware statutory trust sponsored by an affiliate of Peachtree Group (Peachtree Hotel Group II, LLC). The trust owns a single, newly constructed (2026) Class-A build-to-suit industrial sales-and-service facility of approximately 48,206 square feet (about 85% warehouse, 15% office) on 11.86 acres at 1540 E. Chain of Rocks Road in Pontoon Beach, Illinois, within Gateway Commerce Center South — one of the largest master-planned industrial parks in the U.S. — in the St. Louis MSA, the nation's 23rd-largest metro. The property is 100% leased to Cummins Inc. (NYSE: CMI), an investment-grade global power-systems manufacturer rated A2 by Moody's and A by S&P, on a 15-year triple-net lease that commenced in May 2026, with 2.25% annual rent escalations (stepping to 2.50%) and five three-year renewal options. Purpose-built to consolidate two legacy Cummins locations, the facility includes 16 specialized service bays, a wash bay, and warehouse and overflow parking. Because there is no mortgage, the offering carries no lender or refinancing risk and suits conservative 1031 exchangers seeking passive, credit-tenant industrial income without leverage, as well as cash investors. The minimum investment is $100,000. The trust targets estimated annual cash-on-cash distributions beginning at 5.07% and rising to 5.76% by year ten, paid monthly, over a projected hold of approximately ten years, with the exit contemplated as a third-party sale of the property (there is no affiliated-REIT or Section 721 roll-up).
Highlights
The property sits within the St. Louis MSA, a bi-state logistics hub of roughly 2.8 million people and the 23rd-largest U.S. metro, positioned near the geographic center of the country and bisected by the Mississippi River. The region is served by six Class I railroads, the nation's third-largest inland port, and immediate access to I-270, I-255, I-55, I-64, and I-70. Specifically, the asset is in Gateway Commerce Center South, part of a roughly 2,300-acre master-planned park with more than 16 million square feet of existing distribution space and occupiers including Amazon, Procter & Gamble, Unilever, FedEx, and Nestlé Purina. St. Louis industrial vacancy is a tight 5.6% (projected to hold near 5.7–5.8% through 2030), with a modest, largely build-to-suit construction pipeline that limits speculative oversupply — a supply backdrop that supports durable occupancy for well-located, single-tenant assets like this one.
Completed in 2026, the facility is a modern Class-A build-to-suit asset purpose-designed for Cummins' regional sales and service operations. Its 48,206 square feet comprise roughly 40,710 square feet of warehouse and 7,496 square feet of office, with 16 specialized interior service bays, a wash bay, 30-foot clear shop height, 20 grade-level and one dock-high doors, and substantial trailer and overflow parking on a low-coverage 11.86-acre site. The property is 100% leased to Cummins Inc. (NYSE: CMI) — founded in 1919, operating in more than 190 countries with approximately 67,400 employees and around $33.7 billion in 2025 revenue — on a triple-net basis, so the tenant bears property taxes, insurance, and maintenance. The facility consolidates two prior Cummins locations into a single regional service center, a purpose-built configuration and major-route visibility intended to reinforce the asset's strategic importance to the tenant.
PG St. Louis Industrial is structured entirely debt-free. With no mortgage on the property, the offering carries no loan-to-value leverage, no lender cash-management or cash-sweep provisions, and no balloon maturity or refinancing risk that could force a sale or cut distributions — the single largest source of downside in a leveraged net-lease DST is simply absent. For a 1031 exchanger, an all-cash structure can satisfy the equity side of a replacement without taking on new debt, and it removes any dependency on the debt markets at the projected ten-year exit. The tradeoff is that all-cash forgoes the potential yield enhancement that positive-leverage financing can provide, so the 5.07% going-in cash-on-cash reflects unlevered, in-place lease income rather than a debt-boosted return. Reserves of $350,000 are established at closing from offering proceeds to fund the capital obligations the landlord retains (roof, structure, and HVAC repairs over $2,000).
Peachtree Group is a privately held, vertically integrated real estate investment, lending, and servicing platform founded in 2008 as a family office. The firm reports having invested over $4.5 billion of equity across real estate equity and fixed-income transactions with a cost basis exceeding $15.8 billion, a current portfolio asset value around $10.6 billion, and more than $4.7 billion in capital under management, with 300-plus employees outside hotel operations. Its platform spans asset management, commercial real estate lending (729 loans / $11.3 billion originated or acquired), acquisitions, development, and property management (111 hotels / 13,852 keys). For its industrial DSTs, Peachtree targets modern (post-2000), functional buildings with strong multimodal access, 100% leased to creditworthy tenants with eight-plus years of remaining lease term, in strong industrial submarkets — criteria this asset was underwritten to meet. Past performance does not guarantee future results.
The interests are structured as replacement property for a Section 1031 exchange, allowing accredited investors to defer capital gains while owning a fractional interest in an institutional, net-leased industrial asset backed by an investment-grade tenant. Distributions are paid monthly and are supported by a 15-year triple-net lease with contractual 2.25% (later 2.50%) annual rent growth, so income is designed to rise on a fixed schedule regardless of market rent movements. Unlike UPREIT-style programs, this offering does not contemplate a Section 721 roll-up into an affiliated REIT; the targeted exit is a third-party sale of the property at the end of an approximately ten-year hold, after which an investor could pursue another 1031 exchange to continue deferral. Investors should note that all exit timing and pricing depend on market conditions for a single, specialized asset, and that favorable 1031/DST tax treatment relies on assumptions that could be challenged by the IRS.
Analysis of PG St. Louis Industrial DST
Insights
Strip away the marketing and PG St. Louis is essentially a fifteen-year, investment-grade credit note dressed as real estate: for the life of the lease an investor is underwriting Cummins' A2/A balance sheet more than St. Louis industrial fundamentals, and that framing is the key to pricing it. The going-in 5.07% cash-on-cash is a full, unlevered coupon that screens roughly in line with the net-lease and industrial DST market, and it steps up a dependable 2.25% a year to 5.76% by year ten — but that growth is contractual, not market-driven, so this is a duration-and-credit play, not an appreciation story. The relative-value catch is the load: on a $23.4M raise against a $19.7M building, only about 84 cents of each dollar buys real estate and roughly 12% is fees and commissions (including a 3% sponsor acquisition fee and a managing broker-dealer that is a sponsor affiliate), so the asset has to appreciate just to make an early exit whole. Forecast Year-1 NOI covers the distribution only about 1.05x, leaving little cushion if a reimbursement or reserve assumption slips. The crux is concentration and residual value: for fifteen years the income is only as good as Cummins — watch its credit trajectory and its unusually explicit tariff and trade-policy exposure — but the terminal outcome turns on whether a purpose-built, 48,000-square-foot service facility with sixteen bays re-tenants or trades cleanly around 2036, and there is no affiliated-REIT 721 backstop, so exit is a single-asset sale at an unknowable cap rate. The escalators are the other quiet risk: 2.25% stepping to 2.50% likely lags a normalized inflation rate, so real income can erode across the hold. Net, this fits a 1031 exchanger who wants a simple, passive, investment-grade coupon with no leverage and can hold to the sponsor's roughly ten-year window; it is the wrong vehicle for anyone who needs diversification, inflation-plus growth, liquidity, or a defined UPREIT exit. We would size it as a bond-like, single-credit sleeve of a larger diversified exchange rather than a standalone solution.
Advantages
The debt-free structure removes refinancing, balloon, and lender-cash-sweep risk and lets a 1031 exchanger replace equity without taking on new leverage. Income is backed by a genuinely investment-grade global tenant — Cummins Inc. (NYSE: CMI), rated A2 by Moody's and A by S&P — on a long 15-year triple-net lease running to 2041, with contractual 2.25% annual escalations that step to 2.50% and five three-year renewal options, so the going-in 5.07% cash-on-cash is scheduled to climb to 5.76% by year ten while the tenant covers taxes, insurance, and maintenance. The asset is new (2026), Class-A, and purpose-built inside Gateway Commerce Center — a premier, low-vacancy (5.6%) St. Louis logistics park with blue-chip occupier neighbors and multimodal rail, road, and inland-port access. The specialized configuration consolidates two legacy Cummins operations, which may raise the asset's strategic value to the tenant and support a renewal at expiry. Sponsorship is institutional: Peachtree Group is vertically integrated with a $15.8B+ cost basis and $4.7B+ of capital under management. A low $100,000 minimum and fully passive, monthly-pay ownership round out a clean, single-credit income profile well suited to a conservative exchanger who values certainty of close and simplicity.
Concerns
This is a single-tenant, single-asset offering: 100% of income depends on Cummins, so any default, bankruptcy, downsizing, or a decision not to renew at the 2041 expiry would eliminate the trust's income with no other property to cushion it. The building is purpose-built for Cummins' sales-and-service use (16 specialized service bays, a wash bay), which the PPM flags could mean substantial re-leasing costs or a lower sale price if the tenant leaves, since the configuration suits few alternative users. As a manufacturer with a global supply chain, Cummins is specifically exposed to tariffs and U.S. trade-policy changes that the sponsor warns could materially affect its financial condition. Pricing is a real consideration: the $23,444,592 offering is well above the $19,700,000 property purchase price, so only about 84% of an investor's dollar reaches the real estate, with roughly 12.3% going to sponsor and selling costs (6.0% selling commissions, a 1.90% managing broker-dealer fee, a 1.0% due-diligence allowance, 0.85% organization & offering expenses, and a 3.0% acquisition fee to the sponsor) plus reserves and closing costs — the property would need to appreciate simply to return capital on a near-term sale. The managing broker-dealer, Peachtree PC Investors, is a sponsor affiliate, creating an acknowledged conflict of interest and the absence of an independent third-party due-diligence review. The 2.25%–2.50% escalators may lag inflation over a decade, and the 5.07% going-in yield is thin compensation for concentrated single-credit risk. With no affiliated-REIT or Section 721 exit, the terminal outcome hinges on selling one specialized asset at an unknown future cap rate roughly ten years out. And as a newly formed DST the trust has no operating history, the interests are illiquid with no public market and no redemption rights, owners have no control and the trustees owe only limited duties, distributions are not guaranteed (Year 1 is a 17-month stub and forecast NOI covers the payout only about 1.05x), and the initial reserve is a modest $350,000 against the landlord's retained roof, structure, and HVAC obligations.
PG St. Louis Industrial DST — Complete Offering Data
Offering & Structure
Investment NamePG St. Louis Industrial DST
SponsorPeachtree Group
StructureDelaware Statutory Trust (DST)
Offering Type506(c)
StatusAvailable
Last Updated2026-07-31
Size & Availability
Total Offering$23,444,592
Equity$23,444,592
DebtAll-Cash
Available Equity$23,444,592 (100% of equity)
Minimum Investment$100,000
Total Load12.27%
Property
Property TypeIndustrial
StrategyCore
LocationIL
Income & Projections
Average Yield5.39%
Projected Yields (Y1–Y10)Y1 5.07% · Y2 5.12% · Y3 5.18% · Y4 5.26% · Y5 5.33% · Y6 5.41% · Y7 5.49% · Y8 5.58% · Y9 5.66% · Y10 5.76%
Tax-Adjusted Yield11.91%
Cap Rate Equivalent7.67%
Year 1 NOI$1,243,600
Y1 Payout Ratio1.05
Financing
In-Place LTV0.00% LTV
Exit
Estimated Hold Period10 years
721 Exchange ExitNone
Benchmarks (vs sector median)
Avg. Income5.39% vs 5.36% market — Meets Average
Growth13.61% vs 15.78% market — Below Average
Peak5.76% vs 5.84% 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.
