ExchangeRight Fully Subscribes $41.9M Net-Leased All-Cash 17 DST
ExchangeRight has fully subscribed its $41.9 million Net-Leased All-Cash 17 DST, an unleveraged, six-property net-leased real estate portfolio offered to 1031 exchange and cash investors. The California-based sponsor of Delaware statutory trust and nontraded real estate investment trust offerings closed the all-cash offering as part of its DST-to-REIT aggregation strategy.
According to the company, the offering is designed to provide investors with stable monthly distributions, currently at an annualized rate of 5.15%, which is covered entirely by in-place lease revenue.
The properties total 148,408 square feet across Texas, Illinois, and Ohio. The portfolio carries an initial weighted-average lease term of 14.1 years.
The Net-Leased All-Cash 17 DST exit strategy is structured to provide investors with a tax-deferred cash-out financing option, along with the potential to complete a 1031 exchange, a 721 exchange into the ExchangeRight Essential Income REIT, cash out, or any combination of these options at exit.
“Our aggregation strategy is designed to leverage the synergies between our DST and REIT platforms to maximize value for our investors,” said Warren Thomas, managing partner at ExchangeRight.
Pending successful future financing, the company said it intends to provide investors with the option to receive a tax-deferred lump sum payment of more than 20% of their initial investment through a cash-out financing, and a tax-deferred 721 exchange of the approximately 80% non-financed equity into the Essential Income REIT. The nontraded REIT recently reported a tax-equivalent yield of 10.42% on 2025 distributions.
“By focusing on necessity-based retail and healthcare properties with primarily investment-grade tenants, All-Cash 17 DST investors can benefit from capital preservation and stable cash flow during the offering’s hold period,” added Thomas. “By later aggregating these rigorously selected properties into the more broadly diversified Essential Income REIT, we intend to provide reduced risk for DST investors as well as enhanced diversification, scale, and value for our REIT investors.”
Earlier this month, ExchangeRight Essential Income REIT expanded its revolving credit facility from $185 million to $600 million, more than tripling its borrowing capacity as the REIT pursues acquisitions and a longer-term transition to fixed-rate corporate bond financing. Wells Fargo acted as the lead arranger, joined by Fifth Third Bank, KeyBanc Capital Markets, and Truist Bank as joint lead arrangers.
ExchangeRight and its affiliates manage more than $7.2 billion in assets, diversified across more than 1,400 properties and 28 million square feet in 47 states, as of March 31, 2026.
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