ExchangeRight, one of the nation’s leading providers of diversified real estate DST and REIT investments, has announced that the Net Asset Value (“NAV”) of the Essential Income REIT has increased for three consecutive quarters, reaching $27.29 per share based in part on an independent real estate valuation of the REIT’s real estate by KPMG combined with its other assets and liabilities as of September 30, 2024.
As of September 30, 2024, the Essential Income REIT’s portfolio includes 353 properties net leased to 37 primarily investment-grade tenants successfully operating in the necessity-based retail and healthcare industries and diversified across 34 states, providing added value for investors through ExchangeRight’s aggregation strategy. The past performance of the REIT does not guarantee future results.
The Essential Income REIT’s monthly distribution rate to investors has remained stable and grown five times since its 2019 launch and throughout unprecedented economic volatility. The REIT’s Adjusted Funds From Operations (“AFFO”) continue to fully cover its current annualized net distribution of 6.37% for Class I shares and 5.99% for Class A shares. The REIT’s AFFO-to-distribution coverage is 105.43% since inception through June 30, 2024, its most recently reported period. This excess distribution coverage helps to ensure that investors are paid exclusively from its operations and not from financing, forced sales, or investors’ capital. The past performance of the REIT does not guarantee future results.
“The steady increase of the Essential Income REIT’s Net Asset Value even in the face of persisting economic volatility is a sign of the resilience of its diversified portfolio,” said Warren Thomas, a managing partner at ExchangeRight. “We credit this resilience to the REIT’s conservative strategy and design, which is structured first and foremost to preserve investor capital and provide stable, tax-advantaged cash flow. The REIT has been able to achieve these objectives on behalf of investors due to its broad diversification, its primarily investment-grade tenants operating in necessity-based industries, and its ability to cover its dividend with Adjusted Funds From Operations.” There is no guarantee the REIT will continue to achieve its investment objectives. Please review the Offering Memorandum to better understand the risks and potential benefits of the Essential Income REIT. The past performance of the REIT does not guarantee future results.
About ExchangeRight’s Essential Income REIT
The Essential Income REIT, a Maryland statutory trust, is a self-administered real estate company, formed on January 11, 2019. The REIT is available to accredited investors only and focuses on investing in single-tenant, primarily investment-grade net-leased real estate. The REIT currently pays an annualized distribution rate on new investments of 6.37% for its Class I shares and 5.99% for its Class A shares, and targets 6.00% monthly tax-efficient income with a 10% total annual internal rate of return for its Class ER shares. The REIT has fully covered its dividend with Adjusted Funds From Operations since its inception and through its most recently reported period. The Company, through its operating partnership, ExchangeRight Income Fund Operating Partnership, LP, owns 353 properties in 34 states (collectively, the “Trust Properties”) as of September 30, 2024. The Trust Properties are occupied by 37 different primarily national investment-grade necessity-based retail tenants and are additionally diversified by industry, geographic region, and lease term. The Company has elected and is qualified to be taxed as a real estate investment trust (“REIT”) for U.S. federal income tax purposes. Please visit the REIT’s website to learn more about its Class ER, Class A, and Class I shares.
The past performance of the REIT, its tenants, and ExchangeRight does not guarantee future performance. “Investment-grade” refers to tenants whose long-term corporate debt rating is considered investment grade by Standard & Poor’s, Moody’s, and/or Fitch. An investment-grade rating is a rating that indicates that a corporate bond has a relatively lower risk of default than a corporate bond with a speculative grade. Adjusted Funds From Operations (AFFO) as defined by NAREIT measures a real estate company’s recurring/normalized FFO after deducting recurring capital improvement funding that is typically capitalized by REITs and the adjustment to GAAP revenue related to “straight-line” rents. There is no guarantee that the REIT’s objectives will continue to be achieved. The REIT is subject to the regular risks associated with real estate. Please review the Offering Memorandum to understand the REIT’s business plan, risks, and potential benefits.
Media Contact
Lindsey Thompson
Senior Media Relations Officer
lthompson@exchangeright.com
(626) 773-3448
