Portfolio Construction

Real estate investors do not nec­es­sar­i­ly have to rely on one prop­er­ty, one mar­ket, or one invest­ment struc­ture.

A port­fo­lio may com­bine direct real estate, DSTs, REITs, pri­vate real estate funds, liq­uid reserves, or oth­er invest­ments depend­ing on the investor’s objec­tives.

Port­fo­lio con­struc­tion con­sid­ers how income, growth, liq­uid­i­ty, diver­si­fi­ca­tion, tax effi­cien­cy, risk, time hori­zon, and estate-plan­ning goals work togeth­er.

The focus should be on the role each invest­ment plays with­in the over­all port­fo­lio rather than sim­ply select­ing indi­vid­ual invest­ments with attrac­tive pro­ject­ed returns.

Key Point: Build the port­fo­lio — not sim­ply the replace­ment prop­er­ty.

Relat­ed DSTNews.org Arti­cles

• Blend­ed Port­fo­lios: DSTs, REITs, and Pri­vate Real Estate

• The Mod­ern Cap­i­tal Allo­ca­tion Mod­el

• Using Mul­ti­ple DSTs to Diver­si­fy 1031 Exchange Pro­ceeds

Impor­tant Dis­clo­sure: This mate­r­i­al is for edu­ca­tion­al pur­pos­es only and is not tax, legal, account­ing, or invest­ment advice or an offer to sell or solic­i­ta­tion to pur­chase any secu­ri­ty. Pri­vate real estate, DSTs, Oppor­tu­ni­ty Zone invest­ments, pri­vate funds, and UPREIT struc­tures involve risk, includ­ing pos­si­ble loss of prin­ci­pal and lim­it­ed liq­uid­i­ty.