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What are the key benefits of a DST? 

A Delaware Statutory Trust (DST) allows investors to defer taxes, eliminate management responsibilities, and access institutional-quality real estate through a 1031 exchange. Key benefits include: 

Tax Deferral

DST investors receive the same tax benefits as a direct 1031 exchange, deferring capital gains, state income taxes and depreciation recapture. The cost basis from the relinquished property also carries over. 

Passive Ownership

A DST removes landlord responsibilities, eliminating the hassle of managing tenants, maintenance and operations. The property is managed by experienced professionals, ensuring investors receive the benefits of ownership without day-to-day involvement.

Access to institutional-quality assets

Investors acquire a fractional interest in larger, professionally managed properties, allowing them to exchange into high-quality assets rather than simply replacing one property with another.

The potential for consistent passive income

DST investors receive monthly passive income without the burdens of active management, making it an attractive option for those seeking steady cash flow. 

Estate planning

DST interests are easier to transfer to heirs than physical property, simplifying estate planning and minimizing tax consequences upon inheritance.

Debt and equity flexibility

DSTs can match debt and equity requirements for a 1031 exchange, solving the challenge of finding a property with the right financing structure. Investors can assume pre-arranged non-recourse debt, making it easier to satisfy exchange rules.