Since 2019 and during 2025 we monitored the equity raised in the Delaware Statutory Trust (DST) market. With much anticipation the overall market did achieve a 48 percent increase in equity raised when compared to 2024. There was equity raised (from investors) of $8.41 Billion during 2025.
January 12, 2026
By Al DiNicola, AIF®
Adinicola@namcoa.com
DST 1031 Specialist
NAMCOA® – Naples Asset Management Company®, LLC
Securities offered through MSC-BD, LLC, Member of FINRA/SIPC
This was reported by Mountain Dell Consulting who engages and tracks activities from sponsors of Delaware Statutory Trust (DST) and TIC Market Equity investment.
Trends in the past Two Years
Macroeconomic headwinds impacted the equity raise in 2023. The 2024 year over 2023-year 12% increase in equity raise was an encouraging sign for investors. 2023 may have been the “Valley” in transaction volume. The 2024 increase was evaluated as a mild rebound, or a thawing of the transaction volume and more transactions were flowing again. In looking back in 2025 there was an initial concern that the interest rates would affect the flow of real estate sale that may prevent investors from completing §1031 exchange. Many DST investments involve a §1031 exchange. The increase in 2025 may be due to people adapting to the higher rates. (Although I remember my first mortgage in Florida was 14%). With a 48.67% increase year over year, 2025 has exceeded expectations and may be a sign of continued optimism to come. If the interest rates do continue to loosen up, that may add more velocity to the market. There are other macroeconomic headwinds affecting many classes of real estate (multifamily, student housing, etc.). The drastic rise in insurance premiums and other operating costs affects the bottom line. Contraction of the DST market was anticipated given a variety of market dynamics, the least of which was the rising interest rates. The rise in interest rates may have caused an overall slowdown in the real estate sales in certain markets. Investors holding traditional real estate may have seen fewer buyers. These buyers may have needed access to capital at an acceptable borrowing rate. However, there is much expectation that conditions will improve in 2026.
Market Metrics.
When comparing year over year market metrics (aside from equity volume) there are a few items to compare as we enter the new year. The availability of offerings (inventory) is always a concern for advisors who deal with investors seeking replacement in the case of a 1031 exchange. We understand the urgency in identifying replacement properties as well as having the ability to close. Here is what the numbers looked like going into 2025 and now going into 2026.
| Entering 2025 | Starting 2026 | |
| Available Equity (all asset classes) | $2,342,198,682 | 3,069,997,440 |
| Number of Programs | 93 | 89 |
| Days on Market | 317 | 210 |
| Number of active Sponsors | 50 | 50 |
| Average 1st Yr. Return | 4.94% | 4.98% |
There is more equity currently available compared to the start of 2025. The number of overall programs remains basically the same. Having a variety of asset classes helps investors who seek a replacement property for a §1031 tax deferred exchange. The days on the market have drastically decreased which means shorter runway (time for offering is available out) of a DST asset. The shorter time may indicate investors look at all options sooner. There has also been a stable projected average first year distribution. One item that was not included in the overall summary of the Mountain Dell Report is the number of all cash DST. There continues to be an increase in the number of all cash DST (an increase in previous years) as well as reduced LTV (Loan to value) or reduced leverage in the DST offerings. This may not be all good news for investors who need to balance their exchanges with debt. Investors with higher than 60% LTV replacement are most affected.
Be Prepared
Yes, the Boy Scouts have a motto of “Be Prepared”. Investors also need to be prepared, especially when looking at the yearly comparisons on what potential investments may be at any given time. This may be compounded or limited by investors’ preferences or suitability with a specific asset class or geographic preference.
“Who are those guys”?
The phrase “Who are those guys?” is a memorable line from the film “Butch Cassidy and the Sundance Kid,” reflecting the confusion and frustration of the characters as they are pursued by a relentless posse. If we were asking where do many of investors in the equity positions in DST reside the answer may not surprise you. The top three states are California and New York followed by Washington. The top states on where the DSTs are located in Texas (1), Florida (2), NC (3), GA/IL (4). There are also portfolios of properties as well that span multiple states.
2025 Result ~ Equity Invested by Asset Class
Current Asset Class Metrics
Sponsors have entered a more conservative underwriting mode, reduced the LTV, and increased the equity needed for each DST. Noted in the chart below is average LTV for each asset class. There are no asset classes with an average LTV of over 50%. Understanding that when displaying an average there may be (depending on the asset class) an LTV over 50%. Thus, for investors with a higher LTV need we have a few alternatives. When we assist an investor with a larger §1031 exchange ($1M and above) especially when debt needs to be replaced, we typically blend multiple DSTs with leverage to diversify the replacement portfolio for the investor. As a sidebar there are cash investors who acquire DST with non-recourse debt for other reasons. Please consult with us about those strategies.
There is a relationship between the above chart of equity raised and the below chart equity available. In 2025 there was more equity invested in Industrial. It should be clear that because there is more equity available in the Multifamily currently the demand for Industrial asset class may still be a factor. Multifamily and Industrial are still in much demand. Necessary retail (especially all cash) continues to be sought after by certain investors. One comment that we should point out is that in the multifamily current offering there is one extremely large single offering that represents over $567 Million. This is one third of the total volume in multifamily.
Current Market Availability
| Asset Class | Number of Programs | Available Equity | LTV | Projected Returns |
| Multi Family | 32 | $1,775,764,904 | 37.41% | 4.56% |
| Industrial | 18 | $420,205,804 | 13.16% | 5.33% |
| Retail | 17 | $322,489,233 | 5.06% | 5.50% |
| Office | 2 | $80,000,000 | 39.42% | 5.60% |
| Office/Medical | 4 | $272,329,978 | 40.62% | 5.39% |
| Senior Housing | 2 | $62,911,566 | 23.61% | 5.38% |
| Hospitality | 2 | $33,062,030 | 38.89% | 2.96% |
| Student Housing | 1 | $10,000,000 | 0.00% | 4.25% |
| Self-Storage | 2 | $75,737,183 | 22.98% | 4.21% |
| Energy | 1 | $21,684,210 | 0.00% | 8.50% |
| Other | 8 | $115,948,205 | 0.00% | 4.73% |
Final DST Market Overview Comments
At the end of 2024 we reflect on a six (6) year average of equity raised prior to 2024 that number was $5.15 Billion. In reviewing the numbers, 2024 was higher than the 6-year average for equity raised. We will shorten the reporting period to a 5-year moving average, which may be typically used as a metric. At the end of 2024, we as well as other advisors, referenced that it may take a few years to get close to the record high reach of $9.2 billion in equity raised in 2022 or the $7.2 billion of equity raised in 2021. Although as we have reported early in 2025 the year started off with several months of over $500 Million being raised. We recognized that 2025 would be a potentially very good year. The new 5-year move average is $7.10B. The underlying demographics for investors wanting to sell actively managed real estate and move into passive ownership will continue to increase. Mountain Dell is forecasting 2026 to hit $10 Billion in equity.
| Year | Equity Raised |
| 2018 | $2.80B |
| 2019 | $3.48B |
| 2020 | $3.19B |
| 2021 | $7.20B |
| 2022 | $9.20B |
| 2023 | $5.04B |
| 2024 | $5.66B |
| 2025 | $8.41B |
We continue to research, review, and monitor all the major DST sponsors. We speak weekly with our sponsor contacts and conduct due diligence on DST offerings. Our continued research enables us to provide a quick response to investor questions regarding their cash investing needs as well as their §1031 tax deferred exchange. We are especially skilled at balancing the exchange debt equity requirements. We also specialize in the §1033 exchange in the case of natural disaster or eminent domain cases. The timeline for investors to decide on their utilization of a §1033 may extend beyond the benchmark 2 years as identified in the §1033 Code and potentially extend to 4 years. This may assist investors in California, Florida, North Carolin as well as other specific areas of the USA.
What to Look for in 2026 and 2027
DSTs have been gaining broader institutional exposure and acceptance. The inclusion of the 721 UPREIT (after a safe harbor period) is a noted addition that needs to be researched for specific investors. Large institutional investors have been stepping into the space. Not only on the sponsor level but also the large institutional player and advisors prospective. Schwab and Fidelity have entered the participation via platforming DSTs. Large wire houses are stepping into the 1031 space on the wealth management side of the business. We remain independent and have access to most all sponsor assets. Our duty is to the individual investors. On a different topic, but potentially of vast interest was the tax bill signed into law in July 2025. The 100% depreciation (included with certain DSTs) may be of interest for certain investors seeking tax strategies. There were also modifications and extensions to the Opportunity Zone (OZ) investment opportunity that we will cover in other posts.
NAMCOA® is a SEC registered investment advisory firm that provides comprehensive portfolio management, financial planning, and fiduciary decision-making services on behalf of retirement plan sponsors. Our Difference is summarized by our fiduciary approach which enables us to better meet portfolio and retirement plan objectives, resulting in stronger risk adjusted returns for investors and peace of mind for Clients. We also focus on alternative real estate investment. Many real estate investors are seeking tax deferred solutions utilizing §1031 exchanges or Opportunity Zones.
DSTs are not for all investors. The acquisition of a DST is for accredited investors only. Contact your investment adviser for additional details on how a DST may be a solution to your 1031 Exchange and suited for your investment future. For more information on how to properly set up an IRC 1031Tax Deferred Exchange or if you are an accredited investor and would like additional information on a DST contact Al DiNicola at 239-691-8098 or email adinicola@namcoa.com.
This is not an offer to purchase or solicitation to purchase any security, as such be made only through an offering memorandum or prospectus. Investing in securities, real estate, or any investment, whether public or private, involves risk, including but not limited to the potential of losing some or all of your investment dollars when you invest in securities. You should review any planned financial transactions that may have tax or legal implications with your personal tax or legal advisor. NAMCOA, LLC is a Registered Investment Advisor, regulated by SEC (Securities and Exchange Commission). Our corporate office is located at 999 Vanderbilt Beach Road, Suite 200, Naples Florida 34108. Securities Offered through MSC-BD, LLC, Member of FINRA/SIPC , 5 Centerpointe Drive, Ste. 400 Lake Oswego, OR, 97035. MSC-BD, LLC and NAMCOA are independently owned and are not affiliated.
Thank you.
