Grow your real estate wealth
Through a combination of 1031 Exchanges and Delaware Statutory Trusts (DST)
$160B
Moved every year through 1031 Exchanges
$10B
Invested in DST's every year
2004
Since Delaware Statutory Trust Act Enacted
Your hard-earned equity shouldn't be lost to paying taxes when you don't have to...
But you also shouldn't lose your cash flow. This is the advantage of the SEMPER strategy.
Because of the 1031 Exchange, you're able to move equity and defer capital gains tax. The key is to move that equity into an asset that cash flows, appreciates, mitigates risk, and doesn't require your every-day attention. DST's are an excellent tool to achieve this.
S E M P E R
S Sell your property
E (1031) Exchange it
M Match your equity with a DST
P Profit with steady cash flow
E Expand your equity
R Repeat the process
S
Sell your property in a seamless way using an investor-friendly real estate agent. Or, just talk to a 1031 exchange expert for help.
E
1031 Exchange your newfound equity with a savvy qualified intermediary (your 1031 exchange expert).
M
Match your equity with a DST or other replacement property that fits your investment goals. This generally requires a DST specialist.
P
Pocket cash flow from your investment property and work with tax specialist to maximize your in-pocket returns.
E
Equity can grow within a DST property with time. It's important to choose your DST wisely so it appreciates well.
R
Repeat this process to grow your real estate portfolio and your returns. Once the DST term is complete, you can 1031 into the next one.
Increase your cash flow, defer your taxes*
Our approach is simple and effective.
Educate Yourself With Us
Read and watch our free information so you're able to enter your next exchange with confidence.
You can also give us a call to learn as well.
Call a Qualified Intermediary
A Qualified Intermediary, or 1031 Exchange accommodator, is your go-to person for real estate tax-deferrals.
Reach out to us if you don't know any and we will point you in the right direction.
If it makes sense for your situation, the process can be quick. You'll have your tax-deferred equity exchanged into a cash flowing DST and begin appreciating immediately.
* Tax deferral and cash flow benefits depend on individual circumstances.
Please consult with a licensed tax advisor or financial professional to understand how these strategies may apply to you.
Frequently Asked Questions
A Delaware Statutory Trust (DST) is a legal entity used for real estate investing, allowing multiple investors to pool funds to own fractional interests in large, income-producing properties. DST's are commonly used in 1031 exchanges, enabling investors to defer capital gains taxes while gaining passive income from professionally managed properties without the responsibilities of direct ownership.
A 1031 exchange lets real estate investors sell one property and buy another without paying taxes right away.
A 1031 exchange is a tax-deferral strategy under Section 1031 of the IRS code, allowing real estate investors to sell an investment property and reinvest the proceeds into another "like-kind" property, deferring capital gains taxes. The term "like-kind" is broader than many people realize; it doesn’t mean the properties have to be the same type. For example, an investor can sell a commercial building and exchange it for a multifamily property, vacant land, or even a Delaware Statutory Trust (DST). This strategy is widely used to grow real estate portfolios, preserve equity, and defer taxes on profits.
With a DST, you can typically expect to earn 4-5% in cash flow, which is paid out to you in monthly distributions. Over time, with property appreciation, your total returns can reach 10-12%. This combination of steady monthly income and long-term growth makes DSTs an attractive option for investors looking for passive income and potential appreciation without the hassle of managing the property themselves. Keep in mind, actual returns can vary depending on the market and the specific properties within the DST.
How to Invest in a Delaware Statutory Trust?
Here’s how to set up your investment in a Delaware Statutory Trust (DST):
1. Educate Yourself – Start by exploring all available resources to learn about DST's and 1031 exchanges. Knowledge is key to making confident decisions about your investment strategy. You can read articles, watch videos, or talk with professionals to deepen your understanding.
2. Connect with a Qualified Intermediary (QI) – A QI is essential for guiding you through the 1031 exchange process. Reach out to a QI who will ensure that your property sale and reinvestment comply with IRS guidelines, helping you defer taxes effectively.
3. Execute the 1031 Exchange into the DST – Once you've sold your property and are ready to invest, the QI will facilitate transferring your equity into a DST. From there, you can start receiving monthly cash flow while your investment grows in value, helping you build long-term wealth.
This setup ensures you are informed, supported by experts, and positioned to make the most of your DST investment.
Yes, to invest in a Delaware Statutory Trust (DST), you need to be an accredited investor.
In the United States, an accredited investor is a person or entity that meets specific financial criteria, allowing them to invest in certain higher-risk, less regulated securities. The U.S. Securities and Exchange Commission (SEC) defines the following requirements for an individual to be considered an accredited investor:
1. Income Test:
- The individual must have earned income exceeding $200,000 (or $300,000 with a spouse or spousal equivalent) in each of the last two years and expect to maintain the same level of income in the current year.
2. Net Worth Test:
- The individual must have a net worth exceeding $1 million, either individually or jointly with a spouse or spousal equivalent. This excludes the value of their primary residence.
3. Entities:
- Entities such as banks, insurance companies, partnerships, corporations, non-profits, and trusts may qualify if they have assets exceeding $5 million or if all equity owners are accredited investors.
Additionally, certain individuals with professional certifications or designations (e.g., Series 7, Series 65, Series 82) and knowledgeable employees of private funds may qualify, even if they do not meet the income or net worth thresholds.
Don't see your question answered?
Our Learning Center
Our goal is to educate first and foremost. Which is why we have created a bunch of free resources for you to enjoy.
While DST's offer several compelling benefits, they are not without their problems. Below, we'll discuss the pros and cons of Delaware Statutory Trusts in detail to help you decide if this investment vehicle aligns with your financial goals.
What others are saying
"cash flow from DST"
"I managed rental properties in California for 15 years and built up enough equity to live off the cash flow from the DST's I invested in."
- Sidney
"I didn't want to manage properties anymore"
"I knew about 1031's but I didn't want to start managing a whole new property. The 1031 into DST strategy let me move the capital and cash-flow in a matter of months."
- Bill
"Appreciation!"
"I heard of Delaware Statutory Trusts from my friend who's a real estate agent. After 5 years, I sold and went right back into another DST with even more cash flow because of the appreciation."
- Bea
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