NX3 Commercial Group has completed an approximately $15 million, three-property 1031 exchange for a repeat California-based client. The portfolio spans restaurant, healthcare and drive-thru retail assets in Florida and Texas, reflecting the investor’s goal of shifting capital into high-growth markets and creating more passive real estate income.
Key takeaways
- The exchange included properties in Katy and Longview, Texas, and Coconut Creek, Florida.
- The assets offer long-term leases, contractual rent increases and limited landlord responsibilities.
- NX3 brokers Josh Ferrito and Matt Wister represented the buyer.
- Ferrito was promoted to vice president of the investment sales team after closing seven 2026 transactions totaling more than $20 million.
The transaction demonstrates how investors can use a 1031 exchange to reposition capital while diversifying across property types and geographic markets. NX3 said the client prioritized credit quality, lease duration and predictable income rather than active property management.
Portfolio combines three defensive property types
The largest component is a Fogo de Chão restaurant in Katy, Texas, situated near the intersection of Interstate 10 and the Grand Parkway. The property has more than 13 years remaining on its triple-net lease, which includes 10% rent increases every five years. Its location benefits from nearby Costco, substantial suburban growth and traffic volumes exceeding 221,000 vehicles daily at the adjacent interchange.
The second Texas asset is the Longview Regional Emergency Center. Leased to Longview Medical Center and backed by Community Health Systems, the freestanding medical facility has approximately 11.7 years remaining on an absolute net lease. The structure places essentially all property-level responsibilities with the tenant, supporting the client’s objective of passive ownership.
In Coconut Creek, the newly built Cali Coffee drive-thru adds exposure to South Florida retail growth. Located within a Sprouts-anchored development at Lyons Road and Coconut Creek Parkway, the property has roughly 14 years left on its absolute net lease and includes 10% rent increases every five years. A 20-year roof warranty further reduces anticipated capital obligations.
Exchange strategy focused on passive income
According to NX3, the California investor wanted to move into markets with more favorable tax and growth characteristics while avoiding the day-to-day demands associated with traditional landlord ownership. The three-property structure provided diversification among food service, healthcare and convenience-oriented retail.
A multi-property 1031 exchange also requires acquisitions to satisfy underwriting standards and close within the exchange timeline. Ferrito said the brokerage emphasized tenant credit, remaining lease term, rent growth and minimal landlord duties when assembling the portfolio.
Ferrito receives promotion after strong transaction volume
NX3 announced Ferrito’s promotion in connection with the closing. The firm said he has completed seven transactions in 2026, representing more than $20 million in volume year to date. The new title is an internal team designation and does not represent an ownership or officer position at the brokerage.
Company executives described the exchange as an example of NX3’s ability to coordinate acquisitions across state lines and tailor net-lease portfolios to repeat clients’ investment objectives. The Fort Lauderdale-based firm advises private investors, family offices and 1031 exchange participants on net-leased real estate transactions nationwide.