Analysis of Investments

Net-Leased Portfolio 15

ExchangeRight

This offering consists of 16 single tenant net-lease retail properties leased to Walgreens, Dollar General, Advanced Auto Parts, Fresenius, Hobby Lobby, CVS, Family Dollar, Goodwill, and Indianapolis Osteopathic Hospital.  

Investment Highlights

  • Yr. 1 Cash-on-Cash 6.51%
  • Initial Occupancy 100.00%
  • Est. Time Horizon 10 years YEARS
  • Current Cash Flow 6.53%
  • Yr. 1 Cap Rate to Investor 5.67%
  • Investor Purchase Price $58,790,000
  • Total Offering Size $27,590,000

Loan Information

This offering's debt has a term of 10 years and is interest only for the whole duration of the loan. The interest is fixed at 4.37%. This is non-recourse debt.

  • Yr. 1 DSCR 2.36
  • Loan-to-Offering 53.07%
  • Hold Period DSCR 2.42

Tenant Information & Lease Terms

The tenants for this portfolio are Walgreens, Dollar General, Family Dollar, Advanced Auto Parts, Fresenius, Hobby Lobby, CVS, Goodwill, and Indianapolis Osteopathic Hospital. 

The weighted average lease term for this portfolio is 12.8 years and there are 10 NN and 6 NNN leases.

Key Positives

  • This offering offers tenant and geographic diversification. 

  • Rent bumps throughout the hold term. 

  • 13 of the 16 properties are leased to tenants with investment-grade financials or which have investment-grade parent corporation guarantors. 

  • Average lease term is 12.8 for the portfolio. 

Key Risks to Consider

  • Upon a sale the price of the properties may have declined if the leftover lease term is under 10 years.

  • There is no guarantee that any tenant will renew their lease after the first lease term.

  • The loan is interest only for its whole term.

  • Three tenants are not investment grade or lack an investment grade lease guarantor.  

Investment Sponsor Information

ExchangeRight

According to the sponsor's website: "ExchangeRight Real Estate, founded in 2012, is a private real estate investment firm focused on the acquisition and management of single-tenant properties throughout the United States. With over $1.2 billion in assets under management diversified across 425 properties in 28 states, we focus on investment-grade, necessity-based retail and Class B/B+ value-added multifamily.

We believe that investors deserve an investment strategy that provides them with stable cash flow, capital preservation, and value-added return potential in the face of uncertain economic and financial conditions. We have implemented a strategy designed to directly address this so that we can preserve our investors' capital and provide attractive income on their capital until the timing is right to execute a strategic exit to maximize their returns."

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