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Executive Summary

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AEI Healthcare Property VII DST

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Offering summary

AEI Healthcare Property VII DST is a $50,500,000 all-equity offering sponsored by AEI Capital Corporation comprising three medical office properties located in Surprise, Arizona; Austin, Texas; and Bristol, Connecticut. The portfolio is being acquired for $45,299,110 at a stated acquisition capitalization rate of 7.00%. The offering requires no debt financing and targets a Year 1 cash flow yield of 5.00%, with a projected full-term average yield of 5.38%. Total front-end offering expenses and fees equal $3,850,148, representing a 7.25% load on total offering equity. AEI Capital Corporation brings a stated 50-year operating history and manages $1,650,000,000 in assets under management across its platform. Master tenant and offering reserves total $371,000 to support ongoing operations across the 1,000 offering units.

Capital raise

0.0% of the offering is closed

$50,500,000 still available

Closed$0 Reservations$0 Available$50,500,000
$0 of $50,500,000 placed
Total offering equity

$50,500,000

Closed equity

$0

0.0% of offering
Current reservations

$0

Pending subscription
Available equity

$50,500,000

Open for subscription

The trust is raising $50,500,000 in total equity divided into 1,000 units. Total upfront fees, placement fees, and selling commissions are capped at 7.25% of total sales ($3,661,250 upfront load plus organizational expenses), paid out of gross proceeds.

Offering terms

Sector

Healthcare real estate

Investment Category

DST

Projected First Year Cashflow

5%

Avg. 5.38% over term

Min. Cash Investment

—

Min. 1031 Investment

—

Total Offering Price

$50,500,000

$50,500 per unit

Offering Debt

—

All-equity offering

LTV

—

On acquisition price

Units / Tenants

1,000

16575 West Waddell Road, Surprise, Arizona 85388; 9817 N. Lake Creek Parkway, Austin, Texas 78717; 1251 Farmington Avenue, Bristol, Connecticut 06010

Property Age

—

The offering is a $50,500,000 unleveraged Delaware Statutory Trust portfolio comprising three medical office properties across Arizona, Texas, and Connecticut. Initial Year 1 cash distribution is projected at 5.00%, increasing to an average of 5.38% over the holding term.

Strengths & considerations

Key strengths

  • All-Equity Unleveraged Capital Structure

    0% Debt

    The offering utilizes zero debt financing, removing interest rate risk, default risk, and refinancing requirements.

  • Acquisition Cap Rate

    7.00%

    The three healthcare assets were acquired at a 7.00% capitalization rate based on the $45,299,110 purchase price.

  • Geographic Diversification

    3 Properties

    Assets are located across three distinct regional markets: Surprise (AZ), Austin (TX), and Bristol (CT).

Key considerations

  • Upfront Syndication Load

    7.25%

    Total upfront load and offering expenses total $3,850,148, reducing invested capital relative to total equity raised.

  • Appraisal to Offering Ratio

    89.93%

    The acquisition cost represents 89.93% of the total $50,500,000 offering price, reflecting syndication load dilution.

  • Escalating Asset Management Fee

    4% Annual Increase

    Asset management fees commence in 2027 at $20,000 per year and escalate by 4% annually thereafter.

Key strengths include an all-equity capital structure with no debt maturity or refinancing risk, a 7.00% portfolio acquisition cap rate, and geographic diversification across three distinct states. The offering is sponsored by an entity with $1,650,000,000 in assets under management and a 50-year firm history.

Sources, uses & fee assessment

Capital Sources

$50.50MTotal offering

  • Offering Equity

    100.0% of offering

    $50.50M

Where the Capital Goes

$50.50MDeployed

  • Acquisition Cost

    89.8% of offering

    $45.37M

  • Offering Expenses

    7.6% of offering

    $3.85M

  • Reserves

    0.7% of offering

    $371K

  • Unallocated / other uses

    1.8% of offering

    $908K

Total Offering

$50.50M

All equity — no mortgage debt

Acquisition Cost

$45.37M

89.8% of offering to the property

Total Fees & Expenses

$3.85M

7.25% of offering

Reserves

$371K

0.7% of offering

Sources comprise $50,500,000 in offering equity with zero financing proceeds. Uses consist of $45,299,110 for property acquisitions, $49,492 in title and recording costs, $371,000 in master tenant reserves, and $3,850,148 in upfront syndication and offering expenses.

Risk read

Tone reflects relative strength, not a rating

Leverage Profile

Positive

No financing was obtained for the acquisition, eliminating interest rate and maturity exposure.

Equity Load

Cautionary

Total upfront load and expenses equal $3,850,148, resulting in an 89.93% appraisal-to-offering ratio.

Asset Age Disclosure

Neutral / Missing Info

The offering documentation does not disclose the vintage or year built for the three properties.

Fee Escalations

Standard

Asset management fees are deferred until 2027 at $20,000 per year, escalating at 4% annually.

Primary underwriting considerations include front-end equity dilution with an appraisal-to-offering ratio of 89.93%, total upfront fees of $3,850,148, and ongoing asset management fees beginning in 2027 with 4% annual escalations. Specific property ages, construction vintages, and staffing counts are not disclosed.

Calculated underwriting metrics

Syndicated Cap Rate

—

NOI ÷ offering price

Upfront Load

7.25%

Total fees ÷ offering price (all-equity offering)

Premium / Discount

—

Offering price vs. appraised value

Offering vs. Acquisition

111.5%

Offering price ÷ acquisition price

Price per Unit

$50,500

Offering price ÷ 1,000 units

The acquisition price of $45,299,110 equates to an appraisal-to-offering ratio of 89.93%. Front-end syndication and organization expenses total $3,850,148, resulting in a 7.25% upfront load on offering equity, while reserves are established at $371,000.

Sponsor

Sponsor

AEI Capital Corporation

AEI Capital Corporation possesses a 50-year stated history in tax-advantaged real estate and manages $1,650,000,000 in total assets. The sponsor has executed 28 DST programs, though specific historical DST performance and employee counts are omitted from the excerpts.

$1.65B AUM50-Year Legacy28 DSTsHealthcare Focus
Portfolio

The sponsor’s DST currently owns three healthcare properties in its portfolio: the Surprise Project in Surprise, Arizona, the Austin Project in Austin, Texas, and the Bristol Project in Bristol, Connecticut.

Properties owned or managed

AUM

$1,650,000,000

Across all programs

DST programs

28

Prior DST offerings

AUM in DSTs

—

DST-held assets

Team

—

Disclosed headcount

Sector focus

healthcare real estate

Stated strategy

View Sponsor Dossier

AEI Capital Corporation serves as sponsor, highlighting a 50-year legacy in tax-advantaged real estate investments and $1,650,000,000 in total assets under management. The firm has completed 28 DST programs, though specific staffing levels and DST historical track record details are not disclosed in the offering materials.