Fortress Investment Group has launched Fortress Real Estate Exchange, a new 1031 exchange platform designed to provide financial advisors and their clients with access to institutional-quality real estate investments through Delaware Statutory Trusts (DSTs). 

The platform will initially focus on senior housing, student housing and multifamily properties, sectors Fortress believes are supported by strong demand and constrained new supply. The strategy is aimed at helping property owners transition out of actively managed real estate while maintaining exposure to income-generating assets. 

Fortress Real Estate Exchange is structured to address several key planning objectives for investors, including deferring capital gains taxes through 1031 exchanges, diversifying real estate holdings and reducing the operational burden of direct property ownership. 

“The opportunity set within the real estate sectors that Fortress Real Estate Exchange is targeting is robust, with new supply for senior housing, student housing, and multifamily well below peak levels and demand remaining strong,” said Eli Edwards, head of U.S. real estate equity at Fortress. 

“Given the valuation resets we’ve seen over the past five years and the supportive underlying fundamentals, we believe this is a compelling entry point for new real estate asset acquisitions – with the potential to deliver durable income streams to investors,” Edwards added. 

The platform will structure offerings to provide investors with greater flexibility at exit, particularly by avoiding mandatory UPREIT structures, which can limit liquidity options. 

In connection with the launch, Fortress has selected Orchard Securities LLC as dealer-manager for future offerings. Baker McKenzie will provide legal counsel, EA RESIG, LLC will serve as fund administrator, and LODAS Markets, Inc. will act as transfer agent.