ExchangeRight, one of the nation’s leading providers of diversified real estate DST and REIT investments, has announced that the company’s Essential Income REIT has entered into a Credit Facility with Wells Fargo, closing on the first $75 million of the revolving line of credit. The Credit Facility may be increased to $400 million upon request of the Essential Income REIT, subject to receipt of commitments for the increased amount.
Securing this Credit Facility with Wells Fargo on behalf of the REIT powerfully advances the execution of ExchangeRight’s aggregation strategy by enhancing the company’s financing capacity, flexibility, and operational resilience. This facility positions ExchangeRight to optimize the REIT’s balance sheet with long-term fixed-rate corporate bond financing, providing the company with greater control to lengthen and ladder the REIT’s debt maturities at favorable rates once the time is right.
The REIT may utilize the Credit 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. These advantages empower the REIT to execute on its investment strategy even more efficiently than it has since its 2019 launch. As of May 31, 2024, the REIT has aggregated a portfolio of 353 net-leased properties diversified across 34 states and 36 primarily investment-grade and historically recession-resilient tenants successfully operating in the necessity retail and healthcare industries.
Joshua Ungerecht, a managing partner at ExchangeRight, shared that this agreement is expected to help optimize the REIT’s business operations to provide further protection and value-creation for investors.
“This is the next step in the growth of the Essential Income REIT and ExchangeRight’s aggregation strategy,” said Ungerecht. “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. On behalf of the REIT’s investors, we are grateful for the relationship with Wells Fargo and for their thoughtful due diligence on the quality of the Essential Income REIT’s current portfolio and ExchangeRight’s investment and aggregation strategy. We remain committed to steward the trust placed in us by investors, advisors, representatives, and now, Wells Fargo with their provision of this valuable Credit Facility.”
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, focusing on investing in single-tenant, primarily investment-grade net-leased real estate. The REIT currently pays an annualized distribution rate on new investments of 6.41% for its Class I shares and 6.02% for Class A shares and has fully covered its dividend with Adjusted Funds from Operations since 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 May 31, 2024. The Trust Properties are occupied by 36 different national primarily 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. For more information, please visit the Class A website for broker-dealers, registered representatives, and their investors, or the Class I website for RIAs, advisors, family offices, institutions, and their investors. Past performance of the REIT and ExchangeRight does not guarantee future performance.
Media Contact
Lindsey Thompson
Senior Media Relations Officer
lthompson@exchangeright.com
(626) 773-3448
