March 2026 DST Landscape Review ~ In Like a LION!

We con­tin­ue our quick overview of the equi­ty raised pri­mar­i­ly in the Delaware Statu­to­ry Trust (DST) mar­ket.  As pre­vi­ous­ly report­ed, there was equi­ty raised (from investors) of $8.41 Bil­lion dur­ing 2025.  This was report­ed by Moun­tain Dell Con­sult­ing who engages and tracks activ­i­ties from spon­sors of Delaware Statu­to­ry Trust (DST) and TIC Mar­ket Equi­ty invest­ment.   We did add com­men­tary to dive a lit­tle deep­er into the num­bers. 2026 con­tin­ues to deliv­er con­sis­tent results. Through the end of Feb­ru­ary there has been $1,519,393,639 raised. There are ear­ly indi­ca­tions that the total may poten­tial­ly reach $10 Bil­lion.  This would sur­pass the 2023 record of $9.5 Bil­lion.

March 9, 2026

By Al DiNi­co­la, AIF®
Adinicola@namcoa.com

Pri­vate Fund Advi­sor
DST 1031 Spe­cial­ist
Naples Asset Man­age­ment. LLC
Secu­ri­ties offered through MSC-BD, LLC, Mem­ber of FINRA/SIPC

Trends in the past Two Years  

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. There are also sev­er­al prop­er­ties still adjust­ing and get­ting back to nor­mal from the North Car­oli­na hur­ri­cane after­math. There are also a cou­ple of DST Spon­sors that are in the midst of con­sol­i­da­tion and poten­tial merg­ers for mar­ket effi­cien­cies and reduc­ing ongo­ing costs.

Mar­ket Met­rics.

When com­par­ing year-over-year mar­ket met­rics (aside from equi­ty vol­ume) there are a few items to com­pare as we attempt to eval­u­ate and com­pare month to month. At the end of Feb­ru­ary, the mar­ket as a whole is about $500 Mil­lion ahead in equi­ty raised over last year at this time.  The avail­abil­i­ty of offer­ings (inven­to­ry) is always a con­cern for advi­sors who deal with investors seek­ing replace­ment in the case of a §1031 exchange. The increase of inven­to­ry since the end of 2025 is encour­ag­ing. Espe­cial­ly when you cou­ple that with out­stand­ing start of 2026. We under­stand the urgency in iden­ti­fy­ing replace­ment prop­er­ties as well as hav­ing the abil­i­ty to close. Here are the results at the end of Feb­ru­ary (as report from Moun­tain Dell).

	Start­ing 2026	End of Feb­ru­ary
Avail­able Equi­ty (all asset class­es)	$3,069,997,440	$3,479,333,815
Num­ber of Pro­grams	89	94
Days on Mar­ket	210	216
Num­ber of active Spon­sors	50	56
Aver­age 1st Yr. Return	4.98%	4.81%

There is more equi­ty cur­rent­ly avail­able com­pared to the start of 2026. The num­ber of over­all pro­grams remains basi­cal­ly the same with a small increase.  Hav­ing a vari­ety of asset class­es helps investors who seek a replace­ment prop­er­ty for a §1031 tax deferred exchange.  The days on the mar­ket are con­sis­tent and have dras­ti­cal­ly decreased when com­pared to Feb­ru­ary 2024 (time for offer­ing is avail­able) 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 (albeit mov­ing down 17 bps). What does reduce the aver­age 1^st year return is the intro­duc­tion of sev­er­al ”zero” dis­tri­b­u­tion DST.  The zero DST are struc­tured with high LTV and no dis­tri­b­u­tion.  This struc­ture may pro­vide addi­tion­al tax ben­e­fits form cer­tain investors. 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.

Cur­rent Mar­ket Avail­abil­i­ty

Asset Class	Num­ber of Pro­grams	Avail­able Equi­ty	LTV
Mul­ti Fam­i­ly	36	$1,479,322,860	40.40%
Indus­tri­al	15	986,515,685	17.00%
Retail	11	$115,169,451	7.82%
Office	3	$128,907,905	51.85%
Office/Medical	4	$129,056,128	27.02%
Senior Hous­ing	4	$107,312,443	13.20%
Hos­pi­tal­i­ty	2	$5,387,151	38.89%
Stu­dent Hous­ing	3	$226,508,408	32.03%
Self-Stor­age	3	$180,116,993	15.32%
Ener­gy	3	$27,059,659	0.00%
Oth­er	10	$93,977,132	4.73%

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.

 In 2025 there was more equi­ty invest­ed in Indus­tri­al. The num­ber of indus­tri­al offer­ings has decreased. 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 $400 Mil­lion. This is about 27% of the total vol­ume in mul­ti­fam­i­ly.

Final DST Mar­ket Overview Com­ments

The indus­try and mar­ket may be expe­ri­enc­ing sig­nif­i­cant growth. Over the past num­ber of years there was an aver­age equi­ty raise of $5.15 Bil­lion.    As we tracked 2025 we as well as oth­er indus­try experts 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
2026 Poten­tial	$10.0B

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.   Naples Asset Man­age­ment, 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 Naples Asset Man­age­ment, LLC are inde­pen­dent­ly owned and are not affil­i­at­ed.

Thank you.