Cove Capital Acquires Kentucky Distribution Facility for New Industrial DST
Cove Capital Investments has completed the acquisition of a mission-critical distribution facility in Paducah, Kentucky, anchoring its new Cove Essential Net Lease Industrial 116 Delaware Statutory Trust offering, which is targeting an equity raise of just over $14.5 million.
The offering is structured with zero leverage and features a newly executed long-term lease extension from a premier national logistics operator — a combination that Dwight Kay, managing member and co-founder of the Los Angeles-based firm, said distinguishes the vehicle in the current market for industrial DST offerings.
Paducah’s strategic logistics positioning supports the asset’s mission-critical designation. The site offers immediate access to six U.S. interstates, five Class One rail carriers and river transport connections via the Tennessee and Ohio Rivers to the ports of Mobile and New Orleans. The facility serves approximately 175,000 people within a 25-mile radius and roughly 80,000 within 10 miles.
The offering also features an optional 721 UPREIT exit strategy, a structure that Chay Lapin, managing member and co-founder, said provides a meaningful point of differentiation.
“Unlike many sponsors with forced 721 UPREITs, Cove Capital provides investors with full optionality whereby they are able to participate in the 721 UPREIT if they choose to do so, but at their sole discretion,” Lapin said. “This full optionality is a key differentiator in today’s marketplace of DST and 721 UPREIT vehicles.”
The Kentucky acquisition follows Cove Capital’s recent purchase of Saddle Creek Crossing in Wichita, Kansas, which anchors the firm’s new debt-free Cove Kansas Retail DST 109 offering targeting a $12.95 million equity raise.
Pictured: Distribution facility in Paducah, KY