Cove Capital Fully Subscribes $27M Texas Build-to-Rent Delaware Statutory Trust Offering

The 83-unit brand-new Build-to-Rent residential community in San Antonio successfully sells out after securing $27,223,181 from accredited 1031 investors.

LOS ANGELES, May 6, 2026 /PRNewswire/ -- Cove Capital Investments, LLC, a DST sponsor company specializing in debt-free 1031 exchange and direct cash investment options for accredited investors, announced that its Cove Texas Build-to-Rent 97 DST Offering (Regulation D, Rule 506(c)) is fully subscribed.

The offering raised $27,223,181 in equity from accredited 1031 exchange and direct cash investors.

Key Takeaways 

Cove Capital Investments fully subscribed its Texas Build-to-Rent 97 DST offering, raising $27,223,181 from accredited 1031 exchange and direct cash investors.

• The property is an 83-unit brand-new Build-to-Rent residential community in San Antonio, Texas.
  
  
• The DST is 100% debt-free, meaning no lender foreclosure risk and the asset was acquired below appraised value.
  
  
• Principals invested their own capital alongside investors, aligning incentives.
  
  
• Investors receive a fully optional 721 Exchange exit strategy (not a forced UPREIT conversion).
  
  
• Accredited investors can view available DST properties at www.covecapitalinvestments.com.

What Makes This DST Unique

The Cove Texas Build-to-Rent 97 DST consists of 83 newly constructed single-family rental units in San Antonio, Texas. Amenities include:

• Resort-style pool
  
  
• Lazy river
  
  
• Proximity to San Antonio's largest employers
  
  
• Access to top-ranked schools

According to Dwight Kay, Managing Member and Founder of Cove Capital Investments, the property's highly sought-after San Antonio submarket location helped drive strong investor demand.

"The successful sellout of this DST offering reflects strong investor confidence in Cove Capital's fully integrated real estate team and our commitment to acquiring high-quality, debt-free assets in key markets across the country on behalf of our 1031 exchange DST investors."

— Dwight Kay, Managing Member and Founder, Cove Capital Investments

Debt-Free Financing Structure Provides Potential Key Advantages to Investors

Cove Capital acquired the asset 100% debt-free. This structure delivered multiple benefits:

Monthly Income Potential

According to Chay Lapin, Managing Member and Founder of Cove Capital, highlighted the offering's income potential.

"This DST offering has significant income potential for investors. There is room for potential rental rate increases as leases roll over in the coming months, adding to the potential for growing revenue and Net Operating Income (NOI)."

— Chay Lapin, Managing Member and Founder, Cove Capital Investments

Optional 721 Exchange Exit Strategy (Not Forced)

Unlike many DST sponsors that force investors into a 721 UPREIT, Cove Capital offers a fully optional potential exit strategy.

Lapin explained:

"Instead of signing up today for a forced 721 UPREIT DST, our investors are going to be given the option to participate in a future potential 721 UPREIT or not — at their discretion. This means that at the time of any potential future 721 UPREIT transaction, our investors will be able to analyze the final destination REIT by examining key areas such as REIT debt levels, dividend coverage ratios, the use of floating rate debt, whether the REIT offers a Tax Protection Agreement (TPA), and other key components investors must consider prior to participating in a 721 exchange UPREIT DST investment."

Key distinction: Cove investors retain the option to pursue a 721 strategy, or pursue another Delaware Statutory Trust offering, or pay capital gains taxes.

Why Build-to-Rent Is Growing

The Build-to-Rent (BTR) asset class is experiencing strong demand from both tenants and investors.

According to Cove Capital Investments principals, rising home prices and mortgage rates have made homeownership increasingly difficult for young families, driving demand for BTR properties.

Recognition and Invitation

Cove Capital thanked the 1031 DST investors who participated in the offering, as well as the over 2,600 DST investors nationwide that have selected Cove Capital as their DST sponsor of choice.

For accredited 1031 exchange investors:

Cove Capital invites interested investors to view a list of available Delaware Statutory Trust (DST) properties by registering on their website:

www.covecapitalinvestments.com

Frequently Asked Questions Section

Q: What is a debt-free DST?
A: A debt-free DST is a Delaware Statutory Trust offering that uses no mortgage leverage. The asset is purchased 100% with cash equity, eliminating lender foreclosure risk.

Q: How much did Cove Capital raise for this DST offering?
A: Cove Capital raised $27,223,181 in equity from accredited 1031 exchange and direct cash investors.

Q: Is the 721 Exchange exit strategy forced or optional?
A: Optional. Cove Capital gives investors the choice to participate in a potential future 721 UPREIT or not—at their discretion.

Q: What is a Build-to-Rent community?
A: A Build-to-Rent (BTR) community is a residential development of single-family rental units built specifically for tenants, often featuring resort-style amenities like pools and lazy rivers.

Q: Where is this DST property located?
A: San Antonio, Texas, in one of the city's most sought-after submarkets near major employers and top-ranked schools.

Q: Did Cove Capital principals invest their own money?
A: Yes. Cove Capital principals invested their own capital alongside investors in this offering.

Q: How can accredited investors find available DST properties?
A: Accredited investors can register at www.covecapitalinvestments.com to view a list of available DST offerings.

SOURCE Cove Capital Investments