ExchangeRight’s Essential Income REIT Receives $75M Credit Facility from Wells Fargo

ExchangeRight, a provider of real estate DST and REIT investments, announced its Essential Income REIT has entered a credit facility with Wells Fargo, closing on the first $75 million of the revolving line of credit. The facility may be increased to $400 million upon request.

The REIT may utilize the facility to finance permitted acquisitions, certain capital expenditures and investments, payments of applicable pre-development and development costs, as well as to support any of its refinancing and working capital needs, the firm said.

As of May 31, 2024, the REIT had a portfolio of 353 net-leased properties across 34 states and 36 primarily investment-grade and “historically recession-resilient tenants” operating in the necessity retail and healthcare industries.

“With this new credit facility, the REIT will be in an advantageous position to streamline operations and minimize transaction costs, create new opportunities to further diversify debt terms, and lock in long-term financing when rates are favorable,” said Joshua Ungerecht, a managing partner at ExchangeRight.

The REIT currently pays an annualized distribution rate on new investments of 6.41% for its Class I shares and 6.02% for Class A shares and has fully covered its dividend with Adjusted Funds from Operations since inception in 2019 and through its most recently reported period.