Cove Capital Fully Subscribes $27M Texas Build-to-Rent DST Offering

Cove Capital Investments has fully subscribed its Texas Build-to-Rent 97 DST offering after raising approximately $27.2 million in equity from accredited 1031 exchange and direct cash investors.

The Regulation D, Rule 506(c) Delaware statutory trust offering launched in August 2025 consists of a new 83-unit BTR residential community in San Antonio, featuring resort-style amenities such as a pool and lazy river. The property is also in close proximity to some of the city’s largest employers and top-ranked schools, according to Cove Capital.

“This build-to-rent offering in San Antonio is a great example of the Cove Capital team in action, and how our debt-free Delaware statutory trust investment thesis continues to appeal to our growing group of investors, broker-dealers, and [registered investment advisers],” said Dwight Kay, managing member and founder of Cove Capital Investments.

Cove Capital acquired the asset entirely debt-free and, as a result, “the sellers awarded it to Cove Capital below appraised value.” The company said the 100% equity structure eliminates lender foreclosure risk and further enhances investor protection.

Cove Capital’s executives said the BTR asset class is drawing demand from both tenants priced out of single-family homeownership amid rising home prices and mortgage rates, and from investors supplying housing inventory to constrained markets.

Chay Lapin, managing member and co-founder of Cove Capital, said the offering has income upside as existing leases reset. “There is room for potential rental rate increases as leases roll over in the coming months, adding to the potential for growing revenue and net operating income,” he said.

Cove Capital said the offering also carries the potential for a 721 exchange rollup — a tax-deferred strategy that converts DST interests into REIT shares — as an optional exit. Lapin said any 721 transaction would be optional, allowing investors to evaluate the destination REIT — including its debt levels, dividend coverage, and tax considerations — before deciding whether to participate.

Cove Capital Investments is a private equity real estate firm that provides accredited investors with access to 1031 exchange-eligible DST properties and other real estate offerings. The firm has sponsored more than 3.6 million square feet of DST and real estate offerings in the multifamily, net lease, industrial, and office sectors.

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