If you’re ready to retire from landlording, you have a 1031 exchange that is within the 45 day window and not allocated, or simply want to get into a real estate situation that pays you back with no expenses, a DST or Delaware Statutory Trust may be right for you. Say goodbye to tenants, property expenses, management companies and headaches of an aging property. This allows you to invest and collect a check every month.
A DST is not a fund, it is typically one property or a portfolio of properties, where you can be a partial owner. These can include hotels, multi family apartments, storage, and other real estate assets and they can be in any state in the US. The DST takes the ownership of the property and you become a beneficial owner of the trust. You have no liabilities or expenses.
The great thing about DST is that it is a valid real estate entity for a 1031 exchange.
Doing a 1031 exchange into a DST may allow you to swap and underperforming or undesirable asset for an asset that may improve their situation without a tax bill.
Delaware Statutory Trust benefits:
- Retire from being a landlord
- Diversification – invest in several different properties with minimums being $100K
- A new depreciation schedule
- Income potential, no expenses ever
- Higher quality, newer real estate
- Relocate investments to other states with growth potential. Can include multi family, hotels, storage
- A pre-packaged investment with due diligence and financing complete
- Save a failing exchange – DSTs can be identified on the 45th day
- Have cash or debt boot in their exchange, as low as $100K
Let me know if you’re interested in selling a property and talking to a financial advisor about this opportunity!