Cove Capital Investments has acquired a newly constructed industrial distribution center in New Mexico for its Cove Essential Net Lease Industrial 106 DST a Regulation D Rule 506c offering seeking just over $5.5 million in equity. The property completed in 2025 was purpose built for its tenant and designed to support modern supply chain operations with additional capacity for future expansion. Managing Member and Co Founder Dwight Kay noted that the asset is fully leased to a leading supply chain operator that recently executed a new 10 year lease signaling long term commitment.
The offering follows Cove’s zero leverage DST structure a strategy Co Founder Chay Lapin emphasized as central to investor protection. By eliminating property level debt the firm aims to reduce exposure to lender-driven risks such as foreclosure, cash flow sweeps, or operational restrictions. Lapin added that Cove invests alongside its clients in each DST offering. The vehicle also includes an optional 721 exchange feature allowing investors to evaluate and elect participation in a potential REIT roll up after conducting due diligence on factors such as leverage dividend coverage and tax considerations.
The New Mexico asset extends a busy 2025 deal slate that has included single tenant industrial and retail properties in Mississippi Texas Washington Florida Virginia Kentucky and Arizona as well as an 83 unit build to rent community in San Antonio. Across the platform Cove Capital now oversees more than 3.5 million square feet spanning 126 properties nationwide.
Cove Capital Adds New Mexico Distribution Center to DST Lineup is an important development in the real estate investment sector. Cove Capital Investments is known for sponsoring Delaware Statutory Trust offerings that allow investors to participate in institutional grade properties through a passive structure. By adding a new distribution center located in New Mexico the company is expanding its footprint in the industrial logistics space which continues to attract strong demand across the United States.
The newly added distribution center strengthens the DST lineup by focusing on a property type that has shown resilience and growth over the past several years. Industrial distribution centers play a crucial role in modern supply chains as they support storage fulfillment and last mile delivery for retailers and e commerce companies. With the continued expansion of online shopping and regional logistics networks properties in strategic locations such as New Mexico have become more valuable to tenants seeking efficient transportation routes and access to growing markets.
Cove Capital Investments typically targets properties that are net leased to established tenants providing predictable income streams for investors. By including a distribution center in New Mexico the firm is aligning its strategy with broader economic trends including population growth in the Southwest and increased infrastructure investment. The state offers logistical advantages due to its connectivity to major highways rail networks and proximity to neighboring markets such as Texas Arizona and Colorado. These factors make it attractive for regional and national distribution operations.
For investors participating through a Delaware Statutory Trust structure the addition of this asset offers potential benefits such as diversification passive ownership and the possibility of stable cash flow. DST programs are often used by investors completing a 1031 exchange who want to defer capital gains taxes while reinvesting proceeds into income producing real estate. By expanding its DST lineup Cove Capital Investments provides additional options tailored to those seeking exposure to industrial real estate without the responsibilities of active property management.
The timing of this acquisition reflects broader confidence in the industrial sector which has experienced sustained demand driven by supply chain restructuring and consumer behavior shifts. Companies are increasingly focusing on maintaining inventory closer to customers leading to higher occupancy rates in distribution facilities across secondary and tertiary markets. New Mexico has emerged as one such market offering lower operating costs compared to coastal hubs while still delivering strategic geographic access.
Overall the addition of the New Mexico distribution center to the DST lineup demonstrates Cove Capital Investments commitment to identifying properties aligned with long term market trends. The move underscores the continued appeal of industrial assets within diversified real estate portfolios and highlights the role of regional distribution hubs in supporting economic growth. As logistics and e commerce remain central to the modern economy assets like this distribution center are positioned to contribute steady performance within the firm broader investment strategy.
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