Exchange-X, along with managing partner Net Lease Capital, is pleased to announce the offering of NLC Financial Service HQ DST.  NLC Financial Service HQ DST is a highly leveraged, zero-cash-flow Delaware Statutory Trust offering 79.30% of the beneficial interests in a Master Trust that owns a 20-story, 421,481 SF Class A office tower and structured parking garage (319 spaces) completed in 2023, located at 2025 Woodward Ave. in downtown Detroit, MI.

The property is built-to-suit as the headquarters for Huntington National Bank (Huntington Bancshares Incorporated), occupying the building under a 22.5-year absolute NNN lease commencing January 1, 2022 and expiring June 30, 2044, with four seven-year renewal options at 95% of then-fair market rent. Year One Rent (lease year 5) is $8,287,600 (annualized), escalating 2% annually. The lease guaranty is backed by Huntington Bancshares (S&P: BBB+, Fitch: A-). The property is encumbered by three mortgage notes totaling $143,682,974. Because ALL rent from the tenant flows directly to service the loans, investors receive zero cash distributions during the initial lease term. The investment thesis is entirely predicated on residual (terminal) equity value appreciation — the appraiser concludes a terminal value of $240M at initial lease expiry and up to $445M through full renewal terms.

Detroit is Michigan’s largest city with a 2024 estimated population of ~645,000 and a metro area of ~4.4 million (14th largest in the US). It is the global epicenter of the automotive industry and hosts major employers across defense, logistics, healthcare, and IT. The metro hosts 17 Fortune 500 companies. Downtown Detroit has undergone significant revitalization since ~2013, with increased corporate office investment from major financial and tech companies. The property sits on Woodward Avenue, the city’s primary commercial spine, directly in the CBD. Detroit’s office market has faced headwinds post-pandemic common to many Midwest CBDs (elevated vacancy, remote work pressures), though build-to-suit, single-tenant, long-NNN-lease properties like this one are largely insulated from near-term re-leasing risk.