Cove Capital Investments, LLC Completes 83-Unit Build-to-Rent Residential Home Acquisition, Finalizing Its Cove Texas Build-to-Rent 97 DST Offering

Acquired entirely debt-free, this dynamic San Antonio, TX based Delaware Statutory Trust 1031 exchange opportunity offers investors multiple avenues for potential upside, with a targeted equity raise of $27.2 million.

LOS ANGELES, Aug. 6, 2025 /PRNewswire/ -- Cove Capital Investments Founding Partners, Dwight Kay and Chay Lapin, announced the Delaware Statutory Trust sponsor firm successfully completed the purchase of a brand-new Build-to-Rent multifamily residential home community in San Antonio, TX. The purchase completes the formation of the firm's Cove Texas Build-to-Rent 97 DST, a Regulation D, Rule 506(c) offering that has a $27,223,181 equity raise.

The Cove Texas Build-to-Rent 97 DST features a community of 83 newly constructed single-family rental units featuring high-end, resort style amenities and located in the thriving city of San Antonio, TX.

"This DST offering offers prospective investors an exceptional opportunity to invest in a trophy asset in one of San Antonio's most sought-after submarkets. The Cove Dallas Build-to-Rent 97 DST is in direct proximity to some of the city's largest employers and top-ranked schools, along with offering an extensive amenity package that includes a resort-style pool and a lazy river that continues to be a major attraction for current and prospective tenants," said Kay.

The Cove Dallas Build-to-Rent 87 DST offering was constructed in 2024 and currently has an occupancy rate of 95% as of July 30,2025. Each of the 83 rental homes has an average square footage of 1,861 square feet. In addition, this DST offering has significant income potential for investors as 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).

Offering Has Additional Benefits Associated with Debt-Free Acquisition Structure

Because Cove Capital acquired the asset entirely debt-free, the sellers awarded it to Cove below appraised value—creating an immediate value-add opportunity. This 100% equity structure also eliminates lender foreclosure risk, further enhancing investor protection while positioning the Cove Dallas Build-to-Rent 97 DST for potential success.

In addition, Kay explained that like many of Cove Capital's offerings, the firm's principals are investing their own dollars into the property creating an alignment of interest between the sponsor and investors in the offering. This is something that not all DST sponsors.

Why Build-to-Rent is Growing in Popularity for Investors and Tenants

With homeownership becoming increasingly difficult for young families due to rising home prices and mortgage rates, the Build-to-Rent or "BTR "real estate asset class has experienced strong demand from both tenants and investors.

For investors, the build-to-rent model delivers critically needed housing inventory to supply-constrained markets, providing for potentially strong demand fundamentals. In addition, because landlords can reset rents each year, the BTR model also provides investors a potential hedge against inflation.

Conversely, while tenants benefit from the flexibility of lease agreements, they are also shielded from the financial obligations typically associated with single-family homeownership such as rising insurance and maintenance costs.

Chay Lapin, Managing Member and Co-Founder of Cove Capital Investments also emphasized that this offering has the potential for a 721 Exchange rollup as a fully optional potential exit strategy.

"Another important aspect of the Cove Texas Build-to-Rent 97 DST is that it provides investors the possibility of using the 721 Exchange rollup as a fully optional exit strategy. Instead of signing up today in 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, does the REIT offer 721 investors a Tax Protection Agreement (TPA), if so how long is it for? And other key components investors must consider prior to participating in a 721 exchange UPREIT DST investment", said Lapin.

About Cove Capital Investments

Cove Capital Investments is a Delaware Statutory Trust sponsor company that operates a portfolio of over 3 million square feet of real estate in 35 states nationwide. Over 2,164 investors have trusted Cove Capital with their 1031 exchange and investment dollars, many of them being repeat investors in multiple DST offerings over the years. Our offerings are attractive to those investors seeking to lower risk potential as the majority of Cove Capital's DST offerings are debt free (no mortgage - no lender foreclosure risk). To sign up for a list of the current Cove Capital offerings available for 1031 exchange and direct investments please visit www.covecapitalinvestments.com.

For further information, please visit www.covecapitalinvestments.com or contact Cove Capital at (877) 899-1315 and via email at [email protected].

*Past performance is no guarantee of future results.

*Diversification does not guarantee profits or protect against losses.

*This material does not constitute an offer to sell nor a solicitation of an offer to buy any security. Such offers can be made only by the confidential Private Placement Memorandum (the "Memorandum"). Please read the entire Memorandum paying special attention to the risk section prior to investing. This material contains information that has been obtained from sources believed to be reliable. However, Cove Capital Investments, LLC does not guarantee the accuracy and validity of the information herein. Investors should perform their own investigations before considering any investment. IRC Section 1031, IRC Section 1033 and IRC Section 721 are complex tax codes therefore you should consult your tax or legal professional for details regarding your situation. This material is not intended as tax or legal advice. There are material risks associated with investing in real estate, Delaware Statutory Trust (DST) properties and real estate securities including illiquidity, tenant vacancies, general market conditions and competition, lack of operating history, interest rate risks, the risk of new supply coming to market and softening rental rates, general risks of owning/operating commercial and multifamily properties, short term leases associated with multi-family properties, financing risks, potential adverse tax consequences, general economic risks, development risks and long hold periods. There is a risk of loss of the entire investment principal. Past performance is not a guarantee of future results. Potential cash flow, potential returns and potential appreciation are not guaranteed. For an investor to qualify for any type of investment, there are both financial requirements and suitability requirements that must match specific objectives, goals and risk tolerances. Securities offered through FNEX Capital, member FINRA, SIPC.

SOURCE Cove Capital Investments