FSX Industrial 34 is a leveraged DST holding a two-property, single-tenant absolute-NNN industrial portfolio (995,781 SF; 11-plus-year WALT) anchored by Carhartt's primary national distribution hub in Hanson, KY and an Eaton Corporation facility in Duncan, SC. The portfolio was acquired for $86.4M and financed with a $47.52M Old National Bank loan (SOFR+1.95% swapped to 5.495% fixed, interest-only for 48 months then 30-year amortization, 48.63% LTV). Carhartt has invested over $70M in automation at its mission-critical SKU facility, and both tenants carry strong credit, with monthly distributions beginning at a 5.05% cash-on-cash yield.
A two-property, single-tenant absolute-NNN industrial portfolio (995,781 SF total) acquired through a leveraged DST, diversified by geography and tenant. 50% annual escalations, and eight 5-year renewal options. 00% escalations, and five 5-year options. 495%, interest-only for 48 months then 30-year amortization, nonrecourse).
05% annualized cash-on-cash yield. Both tenants' credit is rated 'good' by Alliance Research; Eaton is an investment-grade public company and Carhartt is a privately held, century-old workwear manufacturer. Sponsored by Four Springs TEN31 Xchange (founded 2014); securities offered through Third Seven Capital, LLC and distributed by Four Springs Capital Markets.
| Lender | Old National Bank |
| Interest Rate | 5.50% (Fixed via swap) |
| Loan Term | 7 years |
| Interest-Only Period | 4 years |
| Amortization | 30 years |
| Total Debt | $47.5M ($47,520,000) |
| In-Place LTV | 48.63% |
| Year 1 DSCR | 2.06x |
The portfolio's credit profile is a barbell of one transparent, investment-grade public credit and one strong but opaque private credit. Eaton Corporation (NYSE: ETN) is a globally diversified, century-old power-management company serving customers in over 170 countries, providing rated, publicly reported counterparty strength on the Duncan SC asset. Carhartt is a privately held, 135-year-old workwear manufacturer whose creditworthiness rests on a sponsor-commissioned Alliance Research review rated 'good' rather than a public agency rating, so the larger of the two assets by footprint carries materially less credit transparency, and both leases are with the operating tenants.
Both assets are demonstrably mission-critical to their tenants, which raises renewal probability and switching costs well above a generic warehouse. The Hanson KY facility is Carhartt's primary national SKU distribution hub, into which the tenant has sunk over $70 million of fixed automation (robotics, racking, conveyor) plus more than $1 million of annual capital since 2015, embedding the operation in the building. Eaton has occupied Duncan SC continuously since 1984 and funded a roughly $5 million, 127,000 SF expansion, reflecting four decades of operational entrenchment.
The lease economics are durable and long-dated: absolute-NNN structure with minimal landlord responsibility, an 11-plus-year weighted-average remaining term (11.8 and 11.9 years), contractual escalators, and unusually deep renewal optionality (eight 5-year options at Carhartt extending up to 40 years, five 5-year options at Eaton extending up to 25 years). The qualifier is that the 2.00% to 2.50% escalators sit at or below long-run inflation expectations, so real income growth is limited and the blended roughly 2.35% step-up modestly lags a higher-for-longer cost environment.
Submarket quality is asymmetric across the two assets. The Eaton property sits in the Greenville-Spartanburg industrial market's largest submarket (Spartanburg West), a top-tier institutional logistics corridor with a record-low 2.6% vacancy rate, 5.1% availability, inland-port access at Greer, and I-85 frontage, supporting strong re-leasing economics. The Carhartt property, while logistically well-connected (I-69, CSX rail interchange, Ohio River ports, central to Carhartt's Kentucky manufacturing cluster), is in a rural, tertiary Western Kentucky location where alternative-tenant demand is thin if the incumbent ever vacates.
The financing structure generates positive leverage and, atypically for the ledger, builds principal equity. The $47.52 million Old National Bank loan is swapped to a fixed 5.495% against the in-place yield at 48.63% loan-to-capitalization, and amortizes on a 30-year schedule beginning in year 5, so investors accrete modest equity through the back half of the hold rather than facing a full interest-only balloon. The offset is that the interest-rate swap introduces breakage and termination cost if the assets are sold or the loan is prepaid, and scheduled amortization lifts annual debt service from roughly $2.65 million to about $3.27 million in years 5 through 7, compressing coverage.
The offering pairs two mission-critical, absolute-NNN industrial distribution assets with an 11-plus-year WALT, contractual escalators, and minimal landlord obligation, diversified across two states, two tenants, and two end-industries (apparel logistics and electrical-equipment distribution). Eaton supplies a rated, investment-grade public credit, and both tenants exhibit deep physical and operational commitment to their facilities through substantial tenant-funded capital investment and multi-decade occupancy. The Eaton asset occupies one of the strongest institutional industrial submarkets in the Southeast, and the broader sector benefits from secular e-commerce and supply-chain demand for distribution space. The capital structure uses moderate, fixed-rate (swapped) leverage at 48.63% loan-to-capitalization that produces positive leverage over the in-place yield, supports a healthy 2.06x Year 1 coverage, amortizes to build equity from year 5, and underpins monthly distributions rising from 5.05% to 5.25% over the hold, with reserves funded at closing.
The portfolio is a two-asset, two-tenant pool, so any single vacancy is binary to cash flow, and Carhartt alone represents roughly 68% of square footage, concentrating exposure in the privately held, unrated tenant and its specialized, rural Hanson KY facility where re-leasing or repurposing demand is thin despite the asset's mission-criticality. The two leases expire within roughly one year of each other (approximately years 12 and 12), clustering rollover risk into a narrow window that a buyer at the projected year-7 exit will underwrite with only about five years of residual term remaining. The Eaton building is 1980-vintage with 29-31-foot clear heights, below modern bulk-distribution standards (36-foot-plus), limiting its functional competitiveness for alternative logistics users, and it mixes warehouse, manufacturing, and office space that is more tenant-specific. The financing carries a 7-year balloon and refinancing wall, swap breakage cost on early disposition, and an amortization step-up that raises debt service to roughly $3.27 million in years 5 through 7, causing distributable cash to dip (Year 5 distributable cash of about $2.57 million versus $2.94 million in Year 4) such that distributions are sustained partly through reserve management. Escalators of 2.00% to 2.50% may lag inflation, and the upfront load is high at 15.32% of equity (a 5.16% acquisition fee, 9.69% in offering and selling costs, and a 0.47% finance fee), before a disposition fee at exit, against modest reserves of $864,000.
The analysis below is Baker 1031's educational opinion — not investment, tax, or legal advice, a recommendation, or a guarantee, and it does not replace the offering's Private Placement Memorandum (PPM), which governs in all respects. Read the PPM and consult your own CPA and attorney before investing.
FSX Industrial 34 is a moderately leveraged, core single-tenant industrial net-lease DST whose return is leverage-amplified contractual income: a fixed (swapped) 5.495% loan at 48.63% loan-to-capitalization against the in-place yield lifts cash-on-cash from 5.05% to 5.25% (roughly 5.11% average) over a 7-year hold, with a healthy 2.06x Year 1 coverage. It is closest in profile to the ledger's leveraged net-lease holdings (BREX Net Lease Industrial, ExchangeRight Portfolio 75) rather than the debt-free all-cash series, but is distinguished by being the only entry whose loan amortizes, accreting modest principal equity into the exit. The investment case rests on two mission-critical distribution assets with long WALT and a barbell of one investment-grade public credit (Eaton) and one strong-but-unrated private credit (Carhartt), set against a favorable industrial-demand backdrop and, for Eaton, a premier Spartanburg submarket. The dominant risk-adjusted considerations are the two-asset/two-tenant concentration skewed toward unrated Carhartt in a tertiary market, the older sub-modern Eaton box, two near-simultaneous lease expirations a few years beyond the exit, and a 7-year balloon whose amortization step-up compresses coverage and whose swap imposes breakage cost on early sale. Underwriting feasibility is high on in-place contractual income; the credible variance lies in the exit pricing, refinancing conditions at maturity, re-leasing of two specialized assets at rollover, and the form and timing of the optional Section 721 conversion, which investors may decline in favor of cash. The 15.32% load and below-inflation escalators are the principal economic drags on net return.
The analysis below is Baker 1031's educational opinion — not investment, tax, or legal advice, a recommendation, or a guarantee, and it does not replace the offering's Private Placement Memorandum (PPM), which governs in all respects. Read the PPM and consult your own CPA and attorney before investing.
| Metric | This Offering | Market Avg. | Assessment |
|---|---|---|---|
| Avg. Income | 5.11% | 5.39% | Meets Average |
| Income Growth | 3.96% | 13.50% | Below Average |
| Peak Income | 5.25% | 5.84% | Below Average |
Four Springs Capital
Four Springs Capital reaches the 1031 market through Four Springs TEN31 Xchange, sponsoring net-lease DSTs concentrated in single-tenant industrial and medical properties under long-term leases to credit tenants such as Ford, Eaton and Carhartt. A deliberate focus on the $5 million-to-$200 million deal range keeps it below the institutional bid and above the retail scrum, a niche it has worked across more than 1,000 completed exchanges and over $1 billion in equity raised. As a subsidiary of Four Springs Capital Trust, it offers an UPREIT roll-up into the REIT, combining credit-tenant durability with a defined exit.
Learn More About Four Springs Capital →Documents for this offering. Available to signed-in investors.
Securities offered through Aurora Securities, Inc. (CRD #46147 / SEC #8-51322), member FINRA / SIPC; Baker 1031 Investments, LLC is independent of Aurora Securities, Inc. and is not a registered broker-dealer or investment adviser. This is not an offer to sell or a solicitation of an offer to buy any security; any offer is made solely by the confidential private placement memorandum (PPM), which qualifies all information herein in its entirety. Delaware Statutory Trust interests are speculative, illiquid securities offered under Rule 506(c) of Regulation D and sold only to investors whose accredited-investor status has been verified; offering documents and subscription materials are provided only after that verification. They involve substantial risk, including possible loss of the entire investment.
Distributions, yields, the cap-rate equivalent, DSCR, occupancy, and benchmark figures are sponsor estimates or projections, are not guaranteed, and may differ materially from actual results. Any tax-adjusted yield assumes a 40% effective rate for non-1031 cash investors and is not tax advice. No tax, legal, or investment advice is provided — consult your own CPA and attorney. Past performance does not guarantee future results.