Q3 2026
midwestequity.net
newsletter Navigating Commercial Real Estate and Generational Wealth
midwest diversified x is performing on plan — and the final window is approaching As we enter Q3 2026, Midwest Diversified X has reached a meaningful milestone: $71M+ in investor equity committed, approximately $207.3M in aggregate closings across 15 stabilized properties in eight MSAs, and 18 successful 1031 exchanges placed without delay. The fund is executing exactly as designed.
JOHNSTON, IA
highlights Essential Retail Takeaways State of the Market Behind Every Acquisition Four New MSAs in 2026
What changes this quarter is that the remaining investment window is limited. Period Three closed July 31, 2026. Period Four, the final funding window, opens August 15 and closes September 30, 2026. After that date, Midwest Diversified X permanently closes to new capital and rolls into the Legacy Fund on or about January 1, 2029.
INVESTMENT PORTAL REMINDER
We encourage all investors to log in to the Midwest Equity Investor Portal to review the latest fund documents, account details, and K-1s in one centralized location. If you have questions or have not yet activated your portal, contact InvestorRelations@midwestequity.net for assistance. Your portal is the best place to stay current on fund activity, distributions, and account details. If you have not yet logged in, we encourage you to do so today.
Firm Updates
contact us 319.451.1452, Ext. 1 InvestorRelations@MidwestEquity.net
GLEN ELLYN, IL
midwestequity.net Midwest Equity
PROVEN
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PREDICTABLE
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PRINCIPLED
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Q3 2026
midwestequity.net
essential retail sector Midwest Equity Takeaways
essential retail: why necessity outperforms
When Midwest Equity selects retail assets for the Midwest Diversified portfolio, the question is never "will people shop here?" It is "will people need to come here regardless of economic conditions?" That distinction is the foundation of our Essential Retail strategy. Essential retail refers to tenancy in necessity-driven categories: grocery, dental, fitness, food service, beauty, and personal care. These are services consumers use on a recurring basis, regardless of broader economic conditions. They cannot be fully displaced by e-commerce. And they tend to cluster in high-income suburban corridors where the household spending power to sustain them is strongest. Several structural factors continue to support this thesis: Retail construction starts remain near historic lows. The combination of elevated construction costs, rising interest rates over the prior cycle, and tighter lending standards has suppressed new supply meaningfully. For existing Class A assets with in-place long-term leases, this creates a durable competitive moat — tenants facing lease renewal often find staying put is significantly cheaper than relocating to new construction. Affluent suburban migration continues to reshape demand. Population growth in secondary Midwest and Sun Belt markets — particularly among higher-income households — is directly increasing the addressable trade area for the types of tenants we favor. Markets like McKinney, TX; Fishers, IN; and Charlotte's Ballantyne submarket exemplify this pattern: household incomes above $150K within one to three miles, growing populations, and strong anchor tenancy that validates the submarket. Our Essential Retail holdings in Midwest Diversified X reflect this discipline. Each property was underwritten with a focus on tenant necessity, lease duration, and trade-area income — not foot traffic projections or speculative demand. As we move through the second half of 2026, Midwest Equity believes Essential Retail will continue to deliver the stability and income reliability that makes it a core allocation for long-term investors.
asset allocation
37% INDUSTRIAL
35% RETAIL
28% MEDICAL
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Q3 2026
midwestequity.net
state of the market Commercial Real Estate Notes where things stand
Commercial real estate enters the second half of 2026 in a more settled position than it has been in several years. Interest rate volatility has eased, transaction volume is recovering off a multi-year low, and capital is once again flowing — selectively — toward well-located, well-leased assets. Below is our read on the conditions shaping acquisitions, financing, and pricing this quarter.
~6.5%
10-YR TREASURY RANGE
6.0-7.5%
MEDTAIL/INDUSTRIAL CAP RATES
↑12%
YOY TRANSACTION VOLUME
55-65%
TYPICAL LTC ON STABILIZED ASSETS
five things we’re watching 1. Interest rates have stabilized, not dropped. The Fed’s rate path has flattened rather than reversed sharply, which has done more for underwriting confidence than for headline borrowing costs. Lenders and buyers can now underwrite to a rate that isn’t moving 50 to 75 basis points between a letter of intent and closing — and that predictability has done more to revive transaction activity than any single rate cut would have. 2. Cap rates have found a floor for high-quality assets. Class A medical-retail and industrial properties with long-term, credit-tenant leases are trading in a comparatively narrow band, while older, shorter-lease, or lower-credit assets continue to see wider spreads and softer buyer interest. The gap between “investable” and “everything else” has widened, not narrowed — a trend that favors disciplined, tenant-quality-first underwriting. 3. Lending conditions remain conservative but open. Banks, life companies, and debt funds are actively quoting on stabilized, income-producing deals, though leverage remains conservative relative to the pre-2022 era — typically 55-65% loans-to-cost for well-underwritten acquisitions. Non-recourse, fixed-rate, first-lien structures continue to be the most readily available and most competitively priced. 4. Transaction volume is recovering, unevenly. National CRE transaction volume is running meaningfully ahead of last year, but the recovery is concentrated in necessity-driven sectors — medical office, essential retail, and infill industrial — rather than broadly across all property types. Office and undifferentiated multifamily continue to lag. 5. New construction remains constrained. Elevated construction costs and tighter construction lending have kept new retail and light-industrial supply well below historical norms in most secondary markets. For owners of existing, welllocated Class A product, that scarcity is a tailwind: replacement cost continues to run above what it would take to acquire a comparable existing asset.
where we see pricing becoming attractive
Secondary Sun Belt and Midwest markets with strong household income growth — including several of the submarkets highlighted in this issue — continue to offer a better basis than gateway metros, without sacrificing tenant quality or demographic strength. We’re also seeing improved pricing on off-market and lightly marketed opportunities as fewer institutional buyers are actively competing for mid-size deals in the $5M-$25M range, which remains our core acquisition sweet spot. Page 3
Q3 2026
midwestequity.net
behind every acquisition How Midwest Equity Evaluates Every Investment Opportunity our underwriting lens
We review hundreds of opportunities each year, and only a small percentage ever meet our standards. This discipline was a major topic at our last investor symposium, and for those who weren’t able to join — or newer investors who haven’t heard it before — here is the underwriting lens we apply to every acquisition before it reaches our Investment Committee.
DEMOGRAPHICS MATTER We analyze long-term demographic trends including population growth, employment diversity, migration patterns, education, and age distribution. We favor markets with sustained growth and strong economic fundamentals.
HOUSEHOLD INCOME DRIVES SPENDING POWER Strong household income creates stronger tenants. We evaluate income levels within 1-, 3-, and 5-mile trade areas. High incomes support greater spending, more resilient businesses, higher tenant sales, and long-term growth.
BUYING BELOW REPLACEMENT COST We compare acquisition cost to today’s replacement cost. When replacement costs are higher due to construction pricing, labor shortages, and financing, existing Class A properties become more valuable and difficult to replace.
Many MDX acquisitions are in trade areas where average household incomes exceed $150,000 annually.
LEASE DURATION CREATES PREDICTABILITY We evaluate lease term, renewal probability, rent escalations, tenant improvement exposure, and rollover risk. Our goal is to build a portfolio that delivers dependable cash flow with minimal near-term leasing risk.
TENANT CREDIT REDUCES RISK We assess each tenant’s financial strength, operating history, industry position, and long-term viability. National brands, regional healthcare providers, and essential-service businesses demonstrate greater resilience through economic cycles.
DOWNSIDE PROTECTION COMES FIRST Every acquisition is stress-tested under conservative scenarios including economic downturns, vacancy, interest rate sensitivity, capital needs, market liquidity, and re-leasing potential. We can only move forward when the investment performs well under these assumptions.
a disciplined process, built for long-term investors
The Midwest Equity investment process is intentionally conservative. We focus on acquiring stabilized commercial real estate with durable cash flow, strong demographics, long-term leases, and high quality tenants.
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Q3 2026
midwestequity.net
four new msas in 2026
Midwest Equity’s Investments Expanding Geographically midwest Diversified x enters four new markets
One of the most meaningful developments in Midwest Diversified X is the deliberate geographic expansion beyond our traditional Midwest footprint. For the first time in fund history, Midwest Equity has established positions in four new MSAs — each chosen through a separate, rigorous underwriting process focused on household income profiles, employer base durability, demographic tailwinds, and risk-adjusted acquisition pricing.
Dallas-Fort Worth MSA — McKinney, TX
St. Louis MSA — Lake St. Louis, MO
Madison MSA — Madison, WI
Knoxville MSA — Farragut, TN
The Shoppes at Virginia is a 17,978 SF, 100%-leased twobuilding medical/retail center in the affluent northern Dallas submarket of McKinney. Population within five miles has grown 286% since 2000, with average household incomes of $198K within one mile. Closed in January 2026.
Attractive retail center located on busy Madison Street, one of the area's primary commercial corridors. The 10,118 SF property is leased to a strong roster of national tenants including Chipotle, Massage Envy, Sport Clips, and The Vitamin Shoppe. With new county regulations requiring multifamily elements in future retail developments, existing single-story retail properties are expected to become increasingly scarce and desirable. Under PSA.
South Ridge Shoppes is a newly constructed (2025), 100%-leased 11,222 SF retail center in the fast-growing Lake St. Louis-West St. Charles County corridor. The property benefits from a trade area that has experienced double-digit population growth this decade and is anchored by affluent, family-oriented communities. LOI executed.
Biddle Farms at Farragut is a newly-built (2024) 37,860 SF center in Knoxville's fastest-growing submarket, with average household income exceeding $186K within one mile. Covenant Health — the region's largest employer — operates 10 hospitals and 11,000+ employees across an expanding outpatient network. LOI executed.
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Q3 2026
midwestequity.net
announcements Firm Updates — Q3 2026
midwest equity’s newest team members Lorelle joined Midwest Equity as General Counsel in June 2026, leading the company's legal strategy across acquisitions, financing, leasing, corporate governance, fund operations, and asset management. Working closely with the executive team, she structures and negotiates complex commercial real estate transactions while helping the firm maintain the highest standards of legal compliance and risk management.
Lorelle Lindo
General Counsel
Lorelle brings more than two decades of sophisticated commercial finance and real estate legal experience. Before returning to Iowa, she spent 18 years with the nationally recognized law firm Chapman and Cutler LLP in Chicago, ultimately becoming a Partner in its Finance Practice, where she represented many of the nation's largest banks, private equity sponsors, and institutional lenders in transactions involving billions of dollars in credit facilities across virtually every major asset class. She later served as Vice President and Associate General Counsel at GreatAmerica Financial Services, advising on secured financing, credit facilities, asset-backed securitizations, and equipment finance programs. A graduate of the University of Iowa College of Law, where she earned her Juris Doctor with distinction and served as Executive Editor of the Journal of Corporation Law, Lorelle also holds a Bachelor of Business Administration in Accounting, cum laude, and was elected to Phi Beta Kappa. Her experience with such institutional-caliber counterparties gives Midwest Equity the legal and transactional sophistication typically found at much larger investment organizations. Please join us in welcoming Lorelle!
Mackenzie joined Midwest Equity as Legal Counsel in May 2026, bringing a broad legal background and a practical, business-minded approach. In her role, Mackenzie reviews and negotiates contracts, leases, and purchase and sale agreements, advises on legal and compliance matters, and partners with teams across the organization to support business objectives while helping manage risk.
Mackenzie Main Legal Counsel
After earning her law degree from the University of Iowa College of Law in 2022, Mackenzie spent several years in private practice, working in insurance defense, general litigation, real estate, and business law. Her diverse experience exposed her to a wide range of legal matters and helped her develop the ability to provide strategic guidance that balances legal considerations with business goals. Mackenzie’s litigation background also honed her ability to identify potential risks early and proactively address them through thoughtful contract drafting and problem-solving. Today, she applies these skills to help create frameworks and processes that support efficient decision-making and long-term success across the organization. Mackenzie is motivated by solving complex problems and working alongside others to develop solutions that create value for everyone involved. She finds particular satisfaction in building workflows and processes that not only resolve today's challenges but also provide a foundation for future success. Please join us in welcoming Mackenzie!
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Q3 2026
midwestequity.net
announcements Firm Updates — Q3 2026
midwest equity’s newest team members Kathy joined Midwest Equity in June 2026 as a Cost Segregation Professional, specializing in analyzing commercial real estate assets to identify building components that qualify for accelerated tax depreciation. Drawing on her expertise in engineering, construction, and tax regulations, she helps maximize tax benefits, improve cash flow, and support strategic investment decisions for our investors and portfolio.
Kathy Oberhardt
Manager, Real Estate Cost Recovery
Kathy's path to cost segregation began with a strong foundation in engineering and construction services. Prior to joining Midwest Equity, she worked as a Project Engineer supporting new automation projects, where she gained valuable experience evaluating building systems, construction costs, and commercial real estate assets. This technical background naturally led her to the specialized field of cost segregation, where she combines construction expertise with financial and tax-focused analysis. A certified member of the American Society of Cost Segregation Professionals (ASCSP), Kathy is passionate about solving complex challenges and delivering data-driven insights that help guide informed decision-making. She enjoys working alongside Midwest Equity's talented team of professionals, noting that the organization's collaborative environment and shared commitment to excellence enable the team to develop thoughtful solutions and create meaningful value for investors. Please join us in welcoming Kathy!
Taylor joined as Marketing Coordinator in June 2026, supporting Midwest Equity's marketing efforts through strategic communication, brand development, content creation, and digital engagement. She works to ensure the company's story is communicated clearly and consistently across platforms, helping strengthen Midwest Equity's presence and foster meaningful connections with investors, partners, and the broader community.
Taylor Martensen
Marketing Coordinator
Taylor earned her bachelor's degree in Journalism from the University of Iowa, where she was also a fouryear member of the Iowa Dance Team. Following graduation, Taylor built her career in broadcasting as an afternoon radio personality on Z102.9, where she was part of Those Girls in the Afternoon, one of the few all-female radio personality shows in the country. In addition, she managed the station's social media presence, gaining valuable experience in audience engagement, content strategy, and brand development. Her background in radio and media has given her a distinct perspective on connecting with audiences, building trust, and delivering meaningful messages through a variety of marketing channels. She brings that expertise to Midwest Equity every day, helping tell the company's story in a way that resonates with investors, partners, and the broader community. Please join us in welcoming Taylor!
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Q3 2026
midwestequity.net
announcements Firm Updates — Q3 2026
midwest equity’s newest team members Kincaid joins us as an Asset Management Coordinator, where he is responsible for conducting the initial analysis of property offers submitted to Midwest Equity. He also plays an important role in developing a comprehensive property database designed to strengthen our understanding of regional markets and help identify the strongest investment opportunities. His analytical mindset and data-driven approach provide valuable insights that support informed decision-making across the organization.
Kincaid Foster
Asset Management Coordinator
Kincaid's journey with Midwest Equity began in January 2026 as an intern before transitioning to a fulltime role in June. A recent graduate of Coe College, he earned degrees in both Data Science and Economics, combining analytical expertise with a strong understanding of market dynamics. During his time at Coe, he participated in two summer research terms through the college's Spellman Summer Research Program, where he gained valuable experience analyzing data and developing insights to support economic research. His academic background has proven to be a strong foundation for his current role. Through his data science coursework, Kincaid developed extensive experience in database creation and management, while his research work sharpened the analytical skills, he now uses daily to evaluate opportunities and support strategic investment decisions. Among his accomplishments, Kincaid graduated Summa Cum Laude from Coe College and was recognized with the Spellman Research Fellow Award from the Coe Economics Department. Please join us in welcoming Kincaid!
Gracelyn joined Midwest Equity as a Legal Assistant in June 2026, supporting our Legal Department by helping keep critical processes organized and moving efficiently. Her responsibilities include coordinating deadlines, preparing and filing documents, managing signature workflows, and assisting the legal team with the day-to-day details that help ensure transactions and projects stay on track.
Gracelyn Nickelson
Legal Assistant
Gracelyn graduated from the University of Iowa, where she earned a degree in History. Her academic background provided valuable skills that translate directly to her role today. Through extensive research, analysis, and attention to detail, she developed the ability to evaluate complex information, identify important details, and communicate effectively, all essential qualities in a legal environment. Since joining Midwest Equity, Gracelyn has quickly become an important part of the Legal Department, helping support the processes and documentation that contribute to the company's continued growth. She enjoys working in a fast-paced environment where organization, collaboration, and accuracy play a key role in achieving successful outcomes. Her enthusiasm, attention to detail, and commitment to supporting others make her a valuable addition to the organization. Please join us in welcoming Gracelyn!
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Q3 2026
midwestequity.net
announcements Firm Updates — Q3 2026
distribution update
Period One investors received their first quarterly distribution before June 30, 2026 — right on schedule. Distributions are paid quarterly in March, June, September, and December. Midwest Equity has paid 100% of quarterly distributions on time since fund inception in 2017, across 14 issued funds. No reductions. No missed payments.
new headquarters — fully operational
The Midwest Equity team is now fully settled into our new headquarters at 150 1st Avenue NE, Suite 100 in Cedar Rapids, IA. The space is open for investor meetings, and free parking is available on the north side of the building. We would love to see you.
stay connected on linkedin
A great way to stay current between newsletters is to follow Midwest Equity on LinkedIn. We regularly share market insights, portfolio updates, property spotlights, and firm news — all in one place. Search Midwest Equity on LinkedIn or visit us directly at linkedin.com/company/midwestequity to follow along.
stay connected
MARKET INSIGHTS. PORTFOLIO UPDATES. PROPERTY SPOTLIGHTS. www.linkedin.com/company/midwestequity
summer intern class of 2026 We're excited to welcome our Summer 2026 intern class to Midwest Equity. Supporting our Accounting, Leasing, and Legal teams, these talented students bring fresh perspectives and enthusiasm as they gain hands-on industry experience. Please join us in welcoming Brendan Bakker, Drew Peterson, Jackson Kramer, Lexi Hammer, and Meghan Meyer. We're thrilled to have them on board and look forward to supporting their growth this summer! Disclaimer: This newsletter is for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any securities. Any such offer may be made only by means of a confidential private placement memorandum or prospectus and related subscription documents. Page 9
Q3 2026
midwestequity.net
closing
A Message from Tiffany Williams, Co-Founder Dear valued investors, As I reflect on the first half of 2026, I continue to be grateful for the trust you place in Midwest Equity. Every investment we make represents not only our capital, but yours as well, and we approach that responsibility with the discipline and long-term perspective that has guided our company since our first fund. This quarter marks an exciting milestone for Midwest Diversified X. With more than $71 million in investor commitments and approximately $207.3 million aggregate closings under contract, the portfolio is taking shape exactly as we envisioned. More importantly, it is already producing income through a diversified collection of stabilized industrial, medical, and necessity-based retail properties across some of the country's strongest growth markets. While we are pleased with the progress of Midwest Diversified X, our focus extends well beyond any single fund. We continue to strengthen our organization by expanding our legal, asset management, and marketing teams, investing in new technology, and enhancing the systems that support every property and every investor. These investments are intended to position Midwest Equity for continued success over the long term. As you have read throughout this newsletter, we remain optimistic about the opportunities ahead. Although commercial real estate continues to evolve, our investment philosophy has not changed. We seek high-quality assets with durable cash flow, strong demographics, and long-term leases that can perform through a variety of market conditions. For investors considering Midwest Diversified X, the final funding period represents the next opportunity to participate before the fund closes to new capital. We appreciate the confidence shown by both our long-time investors and those joining us for the first time. On behalf of our entire team, thank you for your continued trust and partnership. We never take it for granted, and we remain committed to protecting and growing your investment for years to come. Warm regards,
Tiffany Earl Williams Co-Founder
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