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NexPoint Small Bay III DST

Available  •  NexPoint

NexPoint Small Bay III DST

Investment Overview

NexPoint Small Bay III DST is a $50 million equity opportunity comprised of a portfolio of two small bay industrial properties located in the Miami-Fort Lauderdale-West Palm Beach and Dallas-Fort Worth metropolitan statistical areas. NexPoint believes that small bay industrial, or light-industrial, properties offer advantages over traditional warehouses or industrial facilities, which generally have a concentrated tenant base with long-term leases. Leases for these properties are generally shorter in term, allowing rents to adjust more quickly in response to market shifts and evolving demand. These leases often include annual contractual rent increases, supporting consistent rent growth throughout the lease term.

Investment Highlights

  • This Offering presents a portfolio of two small bay industrial properties located in the Miami-Fort Lauderdale-West Palm Beach metropolitan statistical area (the “Miami MSA”) and Dallas-Fort Worth metropolitan statistical area (the “DFW MSA”). We believe that small bay industrial, or light-industrial, properties offer several advantages including but not limited to a concentrated tenant base with long-term leases, are typically located in more densely-populated infill areas, and benefit from higher barriers to entry and replacement costs. Leases for these properties are generally shorter in term, allowing rents to adjust more quickly in response to market shifts and evolving demand. These leases often include annual contractual rent increases, supporting consistent rent growth throughout the lease term.
  • Small Bay Properties are often referred to as multi-tenant warehousing or light industrial properties. Roughly 20% of a Small Bay Property is used as an office, and the other 80% is used as a warehouse. The tenants of Small Bay Properties range from small “mom-and-pop” businesses in local distribution, construction, light industrial, and service industries to Fortune 500 companies. The average Small Bay Property floor plan is 2,500 square feet.
  • Arapaho Business Park consists of 19 buildings on over 31 acres. The Property consists of 407,669 SF of rentable spaces which, as of August 31, 2025, is over 90% occupied. Arapaho Business Park features clear heights between 12’ and 16’, premium location of Highway 75, and multiple buildings with several points of entry for easy access.
  • The Deerfield Property offers 102,245 rentable square feet of flex and multi-tenant industrial space across seven buildings. The Property features rear-entry loading with grade-level roll up doors and suite clearance heights between 15’ to 22’. The Deerfield Property is located just 15 miles from downtown Ft. Lauderdale.
  • Based in Dallas, Texas, NexPoint is a multibillion-dollar integrated alternative asset manager. NexPoint has extensive real estate experience, having completed $15.5 billion in gross real estate acquisitions and currently managing $4.9 billion of multifamily assets as of June 30, 2025, inclusive of affiliates. NexPoint deep roots in multifamily have served as the foundation for its DST/1031 Exchange business and enabled the firm to meet the rising investor demand for tax-advantaged real estate offerings.

Quick Facts

Sponsor

NexPoint

Status

Available

Property Type

Industrial

Location

FL, TX

Estimated Hold Period

7-10 Years

In-Place Loan

45% LTV

721 Exchange Exit

Optional

Current Yield

4.62%

Average Yield

5.36%

Current Tax-Adjusted Yield

6.5%

Cap Rate Equivalent⁵

7.41%

Contact

Smiling man in glasses and navy blazer standing in a blurred indoor office setting

Gerald F. "Jerry" Baker, III

Founder, Managing Principal

D 415.579.1660

M 415.278.8503

E jerry@baker1031.com

Income Forecast

4.62%

Year 1

4.66%

Year 2

4.79%

Year 3

5.11%

Year 4

5.19%

Year 5

5.34%

Year 6

5.62%

Year 7

5.99%

Year 8

6.23%

Year 9

6.01%

Year 10

Property images depicted may not be pictures of properties in any current offering and may be representative.

Investment opportunities presented herein are subject to immediate change and may be withdrawn without prior notice. Availability is fluid and often fluctuates rapidly; an offering may close before updated notification is provided. Investors are strictly advised to contact their authorized representative to confirm the current status of any investment prior to committing funds.

The information provided above is for summary purposes only and may be incomplete, outdated, or contain technical inaccuracies. This summary is qualified in its entirety by, and should be read in conjunction with, the relevant Private Placement Memorandum (PPM) and all associated supplements. Prospective investors must rely solely on the PPM and formal offering documents when evaluating the merits and risks of an investment.

⁴Sponsor's Cost Segregation analysis is currently incomplete; therefore, to estimate depreciation benefits, it is assumed the investor is in a 40% combined marginal tax bracket with no current depreciation basis in the property outside of this investment. Average income shielding for this DST is estimated at 45% based on standard IRS straight-line depreciation recovery periods for commercial real estate (39 years), as detailed in this Commercial Real Estate Depreciation Guide. Please refer to the Private Placement Memorandum (PPM) for specifics regarding a cost segregation; notably, even if the Trust does not perform a property-wide study, an individual investor may have the right to commission a private cost segregation study for their specific fractional interest to potentially unlock accelerated or "bonus" depreciation through a change in accounting method.

⁵The "Net-Adjusted Equivalency Cap Rate" is a comparative metric designed to normalize the returns of an all-inclusive Delaware Statutory Trust (DST) against a direct-ownership Net Lease (NNN) property. This metric is calculated by "reversing" a target cash-on-cash return to reconstruct a required Net Operating Income (NOI), adding back debt service and amortizing estimated acquisition, financing, and disposition "friction" costs over a 10-year holding period. This calculation is provided for educational and illustrative purposes only and is not a guarantee of future performance or an offer to sell securities. Limitations include the reliance on generalized market assumptions; individual property performance, actual interest rates, and specific transaction costs will vary. This should not be used as the primary basis for any investment decision. Estimates are derived from the following industry benchmarks: Acquisition Costs (2.5% - NAR Commercial), Loan Fees (1.0% - CREFC Guidelines), Sale Costs (6.0% - Altus Group), and Debt Assumptions (6.5% Interest/30-Yr Amort. - Select Commercial).