One of the questions we receive as experts in Delaware Statutory
Trust investments, is just how do DST real estate properties work for 1031 exchange investors, and how Kay Properties and Investments can potentially help those investors who are considering a 1031 exchange?
Investors can find examples of DST properties for their 1031 exchange on the www.kpi1031.com marketplace.
How Can DST 1031 Properties Help Investors?
DST 1031 properties can potentially help investors with their 1031 exchanges because these properties have been structured with debt already built into the transaction in order to qualify for a 1031 exchange. This is important because in order to qualify for tax deferred 1031 exchange two fundamental requirements must be met, including:
1.) Investors must buy equal or greater value in a replacement property following the sale of your relinquished real estate asset;
2.) Investors must also reinvest 100% of the gains from the sale of the relinquished property into a replacement property.
Get Access to Debt-Free and Leveraged DST 1031 Investment Properties from kpi1031.com
As a national leader in Delaware Statutory Trust investment strategies, Kay Properties has created a unique DST 1031 exchange online platform that allows investors to review replacement 1031 eligible properties with a variety of debt levels, from as low as 27% upwards of 72%.
But what about investors who don’t have any debt to replace? This is not uncommon as many investors have owned their property for many years, and have worked diligently to pay off their mortgages. With no debt to replace, there is little upside for these types of investors to want to enter another 1031 exchange property that has a mortgage attached to it. Kay Properties specializes in helping investors access 100% debt-free real estate offerings for their 1031 exchange. It is also interesting to note that registered wealth advisers and sophisticated real estate investors are recognizing the potential benefits of debt-free real estate DST offerings as a strategy to mitigate risk. I think the bottom line is that many investors never consider the possibility of lender foreclosure, however this is always a potential reality. That’s why the kpi1031.com marketplace has many different loan-to-value offerings (including debt-free offerings) to fit their particular investment scenario.
DST 1031 Properties Have Multiple Investors Holding Beneficial Interest in Each Property
One of the most interesting points of Delaware Statutory Trust properties is that they allow for a group of investors to hold beneficial interests in the property assets of the DST.
It is important for real estate investors to understand that the term “beneficial interest” denotes that investors hold only a percentage of the total ownership, and that no single investor can claim ownership over the DST real estate. Another interesting aspect to DST 1031 exchange properties is DSTs provide the ability to have more than one real estate asset inside the portfolio. That means that DST portfolios can include a multifamily building, a single tenant net lease asset, an industrial facility, a self-storage facility, etc.
How Do DST 1031 Exchange Properties Work with Regards to Potential Appreciation and Distribution?
As noted earlier, because each DST investor owns a fractional interest in the DST along with other investors, all investors their own pro rata percentage of any potential distributions from the DST property. This can potentially include rental income, potential tax benefits, and even overall appreciation of the DST asset.
The ability to potentially receive a pro-rata percentage of an appreciated DST is one of the most popular aspect of DST investments for 1031 exchange investors.
To register for FREE access to the Kay Properties Marketplace of Delaware Statutory Trust listings here:
About Kay Properties and www.kpi1031.com
Kay Properties and Investments is a national Delaware Statutory Trust (DST) investment firm. The www.kpi1031.com platform provides access to the marketplace of DSTs from over 25 different sponsor companies, custom DSTs only available to Kay clients, independent advice on DST sponsor companies, and real estate research and analysis on each DST (typically 20-40 DSTs). Kay Properties team members collectively have over 200 years of real estate experience and have participated in over 30 billion of DST 1031 investments. Past performance does not guarantee or indicate the likelihood of future results. Diversification does not guarantee profits or protect against losses. All real estate investments provide no guarantees for cash flow, distributions or appreciation as well as could result in a full loss of invested principal. Please read the entire Private Placement Memorandum (PPM) prior to making an investment. This case study may not be representative of the outcome of past or future offerings. Please speak with your attorney and CPA before considering an investment.
There are material risks associated with investing in real estate, Delaware Statutory Trust (DST)properties and real estate securities, including illiquidity, tenant vacancies, general market conditions and competition, lack of operating history, interest rate risks, the risk of new supply coming to market and softening rental rates, general risks of owning/operating commercial and multifamily properties, short-term leases associated with multifamily properties, financing risks, potential adverse tax consequences, general economic risks, development risks and long hold periods. All offerings discussed are Regulation D, Rule 506c offerings. There is a risk of loss of the entire investment principal. Past performance is not a guarantee of future results. Potential distributions, potential returns, and potential appreciation are not guaranteed. For an investor to qualify for any type of investment, there are both financial requirements and suitability requirements that must match specific objectives, goals, and risk tolerances. Securities offered through FNEX Capital, member FINRA, SIPC.
