A Delaware Statutory Trust (DST) provides an efficient vehicle to benefit from the advantages of a 1031 exchange. The DST structure allows an investor to buy fractional interest in large, institutional quality,* professionally managed commercial real property as individual beneficial owners of the DST.
Using a DST as the replacement property combines the tax deferral of the exchange with the security and flexibility of the DST. The DST also provides several distinct benefits:
- Increased income potential
- No property management obligation
- Limited personal liability
- Potential to own a portfolio of institutional quality real estate
- Fast and efficient closing process.
*By “institutional quality” I mean properties that are of values typically unaffordable to the average individual investor, generally properties with a value of $30 million or more.