ExchangeRight Net-Leased All-Cash 19 DST

Offering Overview

A debt-free portfolio of three single-tenant, necessity-based net-leased retail properties (122,149 SF total; 10.7-year WALT) acquired in early 2026 and held free and clear, sponsored by ExchangeRight Real Estate, LLC. The portfolio comprises a ~68,459 SF Fred Meyer (a wholly-owned Kroger Co. subsidiary; Kroger S&P BBB) on ~11.65 acres in Shelton WA on a double-net (NN) lease (~58% of NOI; grocery plus fuel), a 50,354 SF Hobby Lobby in Scottsboro AL leased through 2040 (~29% of NOI; three 5-year options), and a 3,336 SF Verizon Wireless (Cellular Sales of Illinois, LLC) in Roscoe IL leased through 2035 (~13% of NOI; two 5-year options). Going-in cash flow is 5.15%, escalating to 5.49% by year 10 (~5.26% average) on contractual rent. The all-equity structure removes refinancing and maturity risk. The exit is ExchangeRight's REIT aggregation strategy: the Essential Income REIT is targeted to acquire the DST interests within ~10 years via an optional Section 721 exchange, with cash-out and combination elections available. The $26,950,000 offering is 100 Class 1 interests at $269,500 ($100,000 minimum equity).

Investment Highlights

• The three-property portfolio is held free and clear with no mortgage, eliminating refinancing, maturity, rate-cap, and foreclosure risk and the equal-or-greater-debt 1031 requirement. Tenants operate in historically recession-resilient, necessity-based retail (grocery, discount craft retail, wireless), supporting income durability through cycles.
• Fred Meyer (a wholly-owned Kroger subsidiary; Kroger Co. S&P BBB) anchors ~58% of NOI on a grocery-plus-fuel format, providing an investment-grade credit backbone. The same fact concentrates the majority of income in a single tenant on a double-net (NN, not absolute-NNN) lease that leaves the trust with certain structural and capital responsibilities.
• A 10.7-year weighted-average lease term with staggered expirations (Verizon 2035, Hobby Lobby 2040) plus renewal options across all three tenants underpins durable contractual income across the targeted hold. Income growth is modest and contractual, lifting cash-on-cash only from 5.15% to 5.49% over ten years.
• The offering is engineered as a feeder into ExchangeRight's Essential Income REIT, which targets acquiring the DST interests within ~10 years. Investors may elect a tax-deferred Section 721 exchange into the REIT operating partnership, a cash-out, or a combination, providing a defined (if sponsor- and REIT-capital-dependent) exit path.
• Total upfront load is comparatively low at ~9.46% of equity (7.23% selling/offering plus a 1.98% acquisition fee and a 0.25% reallowance), modest for an all-cash DST, with ~1.48% of proceeds funded into reserves for operations and asset management.

Forecasted Cash Flow

Projected annual cash-on-cash distributions with the corresponding tax-equivalent yield over the hold, based on the sponsor’s underwriting assumptions.

Illustrative projections only — targeted distributions are not guaranteed and actual results will vary. Tax-equivalent yield assumes depreciation shelter of distributed income.

Analyst Notes

ExchangeRight Net-Leased All-Cash 19 is a debt-free, income-oriented core net-lease vehicle whose return is almost entirely contractual: a 5.15%-to-5.49% cash-on-cash schedule (~5.26% average) sourced from three single-tenant necessity-retail leases with a 10.7-year WALT, with no leverage and no value-add component. The credit profile is anchored by investment-grade Kroger (via Fred Meyer, ~58% of NOI) but is concentrated in two effective credits across three assets, and the Fred Meyer NN lease plus a short-dated, specialized Verizon unit are the principal asset-level vulnerabilities. The defining structural feature is ExchangeRight's REIT aggregation model: the offering is designed as a feeder whose likely terminal path is a Section 721 roll-up into the non-traded Essential Income REIT rather than a third-party sale - attractive for tax-deferral continuity and stable income, but ceding control, liquidity, and valuation transparency to a sponsor-managed NAV REIT and contingent on that REIT's capital. The debt-free design is genuinely defensive in a higher-for-longer environment and the ~9.46% load is comparatively low for an all-cash DST, but the modest, largely flat going-in yield and the absence of leverage cap total return, leaving terminal value and tenant retention at the 2035/2040 expirations as the dominant sensitivities. No tax-equivalent yield is disclosed.

Financing

This offering is unleveraged — the DST holds its assets debt-free (0% loan-to-value), so no mortgage financing applies.

Benchmark Comparison

Benchmark reflects the average of comparable Net Lease offerings. Differences are relative to the benchmark.

Offering Documents

Offering Documents Available By Request

About the Sponsor

ExchangeRight

ExchangeRight has scaled into one of the defining net-lease DST franchises, ending 2025 as the fifth-largest sponsor in the 1031 DST market with roughly $7.0 billion in AUM across more than 1,400 properties and 27 million square feet in 48 states. Founded in 2012 and vertically integrated out of Pasadena, the firm anchors its portfolios in investment-grade-tenanted necessity retail and healthcare—pharmacies, grocery, dollar stores—whose recession-resistant cash flows underpin its consistency. The track record is the headline: 34 full-cycle offerings averaging an 8.60% annual return with no loss of investor capital, all 126 offerings meeting or exceeding distribution projections, and an Essential Income REIT that supplies a 721 UPREIT exit. That combination of scale, tenant credit discipline and full-cycle performance makes it a benchmark for the category.