A Delaware Statutory Trust may be worth considering if you want to remain invested in real estate while reducing the responsibilities of direct property ownership.

DSTs may also be used by cer­tain investors as replace­ment prop­er­ty in a Sec­tion 1031 exchange.

A DST May Be Worth Considering If You:

• Want more pas­sive real estate own­er­ship
• Pre­fer pro­fes­sion­al prop­er­ty man­age­ment
• Are con­sid­er­ing a Sec­tion 1031 exchange
• Want to diver­si­fy among prop­er­ties or mar­kets
• Have a longer-term invest­ment hori­zon
• Do not require imme­di­ate liq­uid­i­ty
• Are com­fort­able with lim­it­ed con­trol over prop­er­ty deci­sions

A DST May Be Less Appropriate If You:

• Need short-term access to your mon­ey
• Want direct con­trol over the prop­er­ty
• Want to per­son­al­ly decide when the prop­er­ty is sold
• Require guar­an­teed income
• Have a short invest­ment hori­zon
• Are uncom­fort­able with pri­vate real estate invest­ment risk

Consider These 6 Factors

Income — What lev­el of cash flow do you need?

Liq­uid­i­ty — How long can your cap­i­tal remain invest­ed?

Con­trol — Are you com­fort­able giv­ing up day-to-day prop­er­ty deci­sions?

Risk — Can you tol­er­ate real estate, spon­sor, ten­ant, and mar­ket risk?

Diver­si­fi­ca­tion — Would spread­ing cap­i­tal among mul­ti­ple prop­er­ties or mar­kets ben­e­fit your strat­e­gy?

Time Hori­zon — Are you pre­pared for a longer-term invest­ment?

The Most Important Question

Would you still con­sid­er this a good invest­ment if there were no Sec­tion 1031 dead­line?

Tax defer­ral can pre­serve cap­i­tal, but it does not make an unsuit­able invest­ment suit­able.

The under­ly­ing prop­er­ty, spon­sor, financ­ing, fees, risks, liq­uid­i­ty, and exit strat­e­gy should all be eval­u­at­ed before invest­ing.

Continue Your Education

What Is a DST?
Investor FAQ
Ben­e­fits & Risks
Con­sid­er­ing Sell­ing?

Important Disclosure

This infor­ma­tion is pro­vid­ed for edu­ca­tion­al pur­pos­es only and is not tax, legal, account­ing, or invest­ment advice. DST invest­ments involve risks, includ­ing illiq­uid­i­ty, lim­it­ed con­trol, real estate mar­ket risk, spon­sor risk, and pos­si­ble loss of prin­ci­pal. Investors should review the applic­a­ble offer­ing doc­u­ments and con­sult their own qual­i­fied pro­fes­sion­als before invest­ing.