The Delaware Statutory Trust, or DST, is a popular investment choice for real estate investors interested in deferring capital gains taxes on appreciated property by using a 1031 exchange. We created the eBook — Bringing Clarity to Your 1031 Exchange — to help potential investors better understand the benefits and risks associated with DSTs.
The potential benefits are numerous, and include:
- No Management Responsibilities.
- DST sponsors are responsible for all the acquisition, financing, property and asset management functions; not the investor.
- Monthly Cash Flow Potential. Most DST investments are designed to provide cash flow on a monthly basis.
- Limited Personal Liability. Loans for DSTs are non-recourse which means they don’t impact the investor’s ability to secure future loans.
- Access to Institutional-Quality Property. DSTs offer the ability for the investor to have fractional ownership in institutional grade property or properties they would not otherwise have access to.
- Estate Planning. Beneficiaries, under current tax law, receive a step-up in basis upon the death of the investor, and DSTs also offer heirs the benefit of professional real estate management.
Some of the risks to understand and consider with Delaware Statutory Trusts include, but are not limited to:
- The amount and timing of distributions is not guaranteed and may vary.
- Investors' capital is not guaranteed.
- Investments are generally not liquid and may have declining market values and tenant vacancies.
If you are interested in learning more about DSTs, please contact us at (224) 245-5281 or at Nathan@Chicagoland1031Exchange.com.
In the meantime, download your eBook here to learn more about DSTs, as well as to discover our 5-step approach that we have been using for years to help investors successfully complete their 1031 Exchanges.