ExchangeRight’s Latest DST Raises $52.85M for Net-Lease Portfolio

ExchangeRight has fully subscribed Essential Income 9 DST, a $52.85 million net-lease real estate offering designed to provide investors with monthly income and a potential tax-deferred transition into the company’s Essential Income REIT.

Structured entirely with investor equity and no property-level debt, the Delaware statutory trust owns three properties totaling 205,857 square feet in South Carolina, Georgia and Virginia. The closed offering is no longer accepting investments.

The properties are leased to Pepsi Bottling Ventures and Tractor Supply Co., companies operating in industries ExchangeRight considers historically resilient during economic downturns. The portfolio provides an annualized cash-flow rate of 5.35%.

Essential Income 9 is backed by a 20-year master-lease guarantee from Essential Income REIT and its operating partnership. The structure is intended to support stable monthly distributions and preserve capital during the DST’s targeted two-year holding period. Following that period, investors are expected to have the option of completing a Section 721 exchange into Essential Income REIT.

ExchangeRight said the transition could provide investors with broader property diversification, continued monthly income, growth potential, estate-planning benefits and greater liquidity.

As of June 30, Essential Income REIT held 436 properties across 38 states. Its net leases were backed by 44 tenants, most of which carried investment-grade credit ratings.

“Essential Income 9 DST’s rapid subscription reflects the strong investor demand we are seeing” for the accelerated pathway into the REIT, Managing Partner Joshua Ungerecht said.

The closing follows seven other recently subscribed ExchangeRight offerings.

Pasadena, California-based ExchangeRight managed more than $7.7 billion across over 1,400 properties totaling 30 million square feet in 47 states as of July 31.