DST/1031 Exchange Archives - BV Capital https://bvcapitaltx.com/category/dst-1031-exchange/ Real Estate Private Equity Firm Tue, 09 Sep 2025 18:00:53 +0000 en hourly 1 https://bvcapitaltx.com/wp-content/uploads/2021/03/siteicontrans.png DST/1031 Exchange Archives - BV Capital https://bvcapitaltx.com/category/dst-1031-exchange/ 32 32 Bridgeview Launches Sacramento Neuro-Rehab Hospital $77M DST Offering https://bvcapitaltx.com/bridgeview-launches-sacramento-neuro-rehab-hospital-77m-dst-offering/ Tue, 29 Apr 2025 18:46:04 +0000 https://bvcapitaltx.com/?p=7368 This launch represents Bridgeview’s fourth DST offering and its first outside its home state of Texas. Like its previous offerings, the BV Ernest Health Neuro Rehab DST is a Regulation D equity raise targeting accredited investors, particularly those seeking to defer capital gains through mechanisms like a 1031 exchange.

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Bridgeview Launches Sacramento Neuro-Rehab Hospital $77M DST Offering

"Medical assets, such as rehabilitation hospitals, are generally perceived as stable investments because demand remains a constant in any economy."

ROB ANDERSON - president of  BV SECURITIES

APRIL 29, 2025 – Bridgeview Real Estate Exchange, a Delaware Statutory Trust sponsor, has launched a $77 million DST offering for 1031 Exchange investors secured by a neuro-rehabilitation hospital in Sacramento, Calif., a property sector with investment stability that can withstand economic tides.

Medical assets, such as rehabilitation hospitals, are generally perceived as stable investments because demand remains a constant in any economy. The BV Ernest Health Neuro Rehab DST is a zero-debt offering backed by a 50-bed hospital at 10 Advantage Court, just north of the city center.

"The Sacramento Rehabilitation Hospital focuses on re-teaching daily living skills to neurological patients. Its multidisciplinary services are always in demand and not impacted by economic cycles," says Rob Anderson, president of Dallas-based BV Securities, Bridgeview's managing broker dealer and a member of FINRA.

 Learn more about our MEDICAL DST

THE PROPERTY

SACRAMENTO REHABILITATION HOSPITAL - 10 ADVANTAGE CT. SACRAMENTO, CA 95834

The hospital, which opened in January 2023, is well-positioned in northeast California and averages 95% occupancy. Furthermore, the operator has overflow referral agreements with two major healthcare providers in the region to ensure maximum patient levels.

Sacramento Rehabilitation Hospital is one of 886 facilities nationwide. Its program evaluation model score places it in the top 1% for patients recovering from accidents and debilitating illnesses or dealing with chronic medical conditions. It's also been accorded top marks for patient acuity, or recovery level, resulting in higher insurance reimbursements and potentially greater profitability.

Patient Room
Therapy Courtyard
Hospital Waiting Room
Sacramento Rehabilitation Hospital Lobby
Hospital Gym Rehabilitation Room
Sacramento Rehabilitation Hospital Day Room

Images of Sacramento Rehabilitation Hospital 

"Sacramento Rehab's success in the first two operating years is noteworthy. It is a testament to its consistent quality care and patient recovery results, which have led to the overflow referral agreements," says Ross Curtis, BV Securities' vice president of sales.

Ernest Health, the operator, is an industry leader and a solid tenant with a good track record. The asset is secured by a 20-year absolute net lease with Dallas-based Ernest Health, which has a portfolio of 35 medical facilities in 13 states. The agreement includes annual rent escalations and two 10-year renewal options.

The just-launched DST is Bridgeview's fourth and first outside its home state of Texas. As with the others, the BV Ernest Health Neuro Rehab DST is a Regulation D equity raise for accredited investors seeking capital gains deferments, including a 1031 Exchange.

Mountain Dell Consulting has ranked Bridgeview 18th in the nation in 2024 for DST equity raise, demonstrating the market's value for its offerings. The company most recently sold out its $27.2 million BV Student Housing Texas Portfolio DST, which launched last summer with a pair of class A properties near Texas Christian University in Fort Worth and University of Texas at Arlington in Dallas.

 Learn more about our MEDICAL DST

Indication of Interest 

Bridgeview DST Investment Programs are sold to accredited investors by authorized broker dealers and registered investment advisors.

Contact your financial professional to learn more. Or, for help finding a financial professional please fill out the form below or contact BV at ir@bvcapitaltx.com for more information on 1031 DST Investments.

  • FINANCIAL ADVISORS

  • INVESTORS

for more information:

Ross Curtis-Vice President of Sales at BV Capital

Ross Curtis

214-833-2710 

ross.curtis@bvcapitaltx.com

About Bridgeview

Bridgeview Real Estate Exchange is a member of the Bridgeview family of companies based in Dallas. Founded in 2011, Bridgeview is a private veteran-owned real estate development and investment company. Bridgeview distributes its DST offerings through BV Securities as Bridgeview’s managing broker dealer.

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Bridgeview Launches Sacramento Neuro-Rehab Hospital $77M DST Offering

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]]> Bridgeview Launches $27.2M Student Housing DST With Two Projects in Fort Worth, Arlington https://bvcapitaltx.com/bridgeview-launches-27-2m-student-housing-dst-with-two-projects-in-fort-worth-arlington/ Wed, 14 Aug 2024 19:37:50 +0000 https://bvcapitaltx.com/?p=6284 "The decision to create a student housing DST was predicated on the lack of supply for this asset class in the investment market's current environment," says Ross Curtis, vice president of sales for BV Securities, one of Dallas-based Bridgeview's integrated companies, and the managing broker dealer for its DST offerings.

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"The decision to create a student housing DST was predicated on the lack of supply for this asset class in the investment market's current environment."

ross curtis - vice president of sales at BV SECURITIES

AUG 5, 2024 – Veteran-owned Bridgeview Real Estate, a Delaware statutory trust sponsor company and developer, has launched a $27.2 million DST offering fueled by high-barrier-to-entry student housing projects at Texas Christian University (TCU) and University of Texas at Arlington (UTA).

Driving Bridgeview's interest in the asset class is its historically consistent demand, creating strong occupancy rates, and a higher potential return on investment than traditional residential properties. Student housing often commands stronger yields due to the proximity to top tier universities.

"The decision to create a student housing DST was predicated on the lack of supply for this asset class in the investment market's current environment," says Ross Curtis, vice president of sales for BV Securities, one of Dallas-based Bridgeview's integrated companies, and the managing broker dealer for its DST offerings.

The BV Student Housing Texas Portfolio DST consists of the 55-unit Liberty Lofts at 3517 S. University Dr. in Fort Worth, which is currently master-leased to TCU, and 70-unit Midtown Urban at 1121 UTA Blvd. in Arlington. The recently launched DST is a Regulation D equity raise for accredited investors seeking capital gains deferments, including 1031 Exchanges.

TCU, like many top universities, experiences strong enrollment growth and a housing shortfall year after year, which initially led to a partial lease with Bridgeview and then a long-term master lease. At UTA, there are roughly 11,000 beds on or near campus for 41,000 students, resulting in Midtown Urban's continued rent growth and healthy occupancy.

"The strong attraction is the absence of student housing construction at TCU and UTA, both of which have high barriers to entry," Curtis emphasizes. "Bridgeview's DST clearly is off to a great start."

THE PROPERTIES

Liberty Lofts was developed in 2009 on 3.61 acres on the TCU campus. Each three-bedroom, three-bath unit totals 1,200 sf. It was fully renovated in 2022, with upgrades including covered parking and an expanded clubhouse with private study rooms for group projects.

Midtown Urban was completed in 2011 on 3.23 acres near UTA's football stadium and within walking distance of the campus. The unit mix of two-, three- and four-bedroom designs are 878 sf, 1,200 sf and 1,492 sf, respectively.

Pictured on the left is a unit at Liberty Lofts (TCU). Pictured on the right is the game room at Midtown Urban (UTA).

Bridgeview acquired the class A student housing projects during Covid, eyeing the upside in their locations and historically high occupancies due to rising enrollments. TCU's master lease for the entire project runs through mid-summer 2028 while the privately managed Midtown Urban is consistently 96% occupied.

"Student housing is similar to multifamily, which was Bridgeview's inroad to the DST market," says Rob Anderson, National Sales Manager and CEO of BV Securities. "It's the same concept, just a more concentrated customer base with constant demand year over year."

Texas is a prime market for DST investment because of its business-friendly laws and income tax-free status.  The state's dynamics combined with the health of the student housing market create a compelling story for investment.

At the time of this article, Bridgeview has raised 30% of the offering. For 1031 Exchange investors, the minimum investment is $100,000 or direct cash placement of $50,000.


Bridgeview DST Investment Programs are sold by broker dealers and registered investment advisors authorized to do so.

 Learn more about our student housing dst
Ross Curtis-Vice President of Sales at BV Capital

Ross Curtis

214-833-2710 

ross.curtis@bvcapitaltx.com

About Bridgeview

Bridgeview Real Estate is a member of the Bridgeview family of companies based in Dallas. Founded in 2011, Bridgeview is a private veteran-owned real estate development and investment company. Bridgeview distributes its DST offerings through BV Securities as Bridgeview’s managing broker dealer.

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]]> Bridgeview Enters DST Market, Fully Subscribes $31M Raise for Class A Project in Dallas https://bvcapitaltx.com/bridgeview-enters-dst-market/ Wed, 23 Aug 2023 14:01:07 +0000 https://bvcapitaltx.com/?p=4702 Marking its inroad into the Delaware Statutory Trust market, BV Capital has fully subscribed Bridgeview‘s inaugural offering, BV Design Multifamily DST, raising $31.14 million for the acquisition and renovation of a 214-unit class A project in Dallas’ eclectic Design District.

“We saw The Dunhill as an excellent opportunity to provide the DST space with a value-add, core-plus investment at a five-star location,” says Rob Anderson, BV Capital’s president. “It’s rare to see a product of this caliber in the DST marketplace.”

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AUGUST 14, 2023 – Marking its inroad into the Delaware Statutory Trust market, BV Capital has fully subscribed Bridgeview‘s inaugural offering, BV Design Multifamily DST, raising $31.14 million for the acquisition and renovation of a 214-unit class A project in Dallas’ eclectic Design District.

The locally based veteran-owned investment firm has been eyeing the DST market for some time. The DST, which is a Regulation D private placement, funded the acquisition of The Dunhill, soon to be rebranded The Adelphi, at 1900 Hi Line Dr., an irreplaceable infill location with neighbors like the 214-key Virgin Hotel and Dallas Urby’s 27-story multifamily twin towers.

“We saw The Dunhill as an excellent opportunity to provide the DST space with a value-add, core-plus investment at a five-star location,” says Rob Anderson, BV Capital’s president. “It’s rare to see a product of this caliber in the DST marketplace.”


Completed in 2010, The Dunhill is a four-story wrap-around design with a parking garage on 4.11 acres. 


Amenities include a saltwater pool with underwater speakers, clubhouse, high-tech gym, business center, amphitheater, outdoor picnic areas and dog park. 

BV Design Multifamily DST

The Dunhill Design District

The well-appointed units range from 665 sf to 1,671 sf, a mix of studios and one- and two-bedroom floor plans.  The Dunhill is situated in the heart of the Design District, a vibrant live-work pocket neighborhood with a unique collection of hip and one-of-a-kind small shops and entertainment venues that are within walking distance of the property.

Directly across the street is trailhead access to the first phase of the Trinity Strand Trail, a walking and biking path that will stretch 7.8 miles along the original channel of the Trinity River to the Katy Trail in Uptown at completion.

The submarket is experiencing effective rent growth of 12% to 15% in the multifamily sector, a factor of its infill location and surrounding amenities.

The Dunhill is a mere two miles from the Central Business District and less than one mile from Uptown Dallas, both of which are major employment centers with a continuously growing roster of international and national firms. The property is within blocks of on and off ramps for Interstate 35 and the Dallas North Tollway. 

“The Dunhill is just the beginning for us in the DST market, where we expect to provide more value-add investment opportunities.”

Steve May

Bridgeview’s president and founder

“The Dunhill is just the beginning for us in the DST market, where we expect to provide more value-add investment opportunities,” says Steve May, Bridgeview’s president and founder. “We are excited to be in this space.”

Bridgeview is a family of integrated companies that includes BV Capital and Bridgeview Multifamily, which has a portfolio of six stabilized class A communities, totaling 1,170 units, and six developments with an additional 1,966 apartments under construction. The properties, which will be valued at more than $330 million upon completion, are located in Arlington, Corpus Christi, Dallas, Denton, Fort Worth, Houston, Mansfield and New Braunfels, all strong Texas markets and several with high barriers to entry.

“We are commercial real estate investors and developers who understand and appreciate the DST space,” Anderson says, “and we are ready to build a bespoke brand as a DST shop as well.”

About BV Capital

BV Capital is a member of the Bridgeview family of companies based in Dallas. Founded in 2011, Bridgeview is a private veteran-owned real estate development and investment company. BV Capital offers investments to existing private clients, broker dealers, registered investment advisors and family offices through BV Securities as Bridgeview’s managing broker dealer.

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]]> The Real Estate Investor’s Guide to DST Investments and 1031 Exchanges https://bvcapitaltx.com/the-real-estate-investors-guide-to-dst-investments-and-1031-exchanges/ Thu, 23 Feb 2023 01:50:12 +0000 https://bvcapitaltx.com/?p=3350 If you're interested in real estate investing, you've probably heard about the DST (Delaware Statutory Trust). A DST investment is an excellent choice for real estate investors who want to invest in commercial and institutional-grade properties that they can't afford to invest in alone.

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table of contents

Why Consider a DST Investment?

If you are a real estate investor, you've probably heard about the DST (Delaware Statutory Trust).  A DST investment is an excellent choice for 1031 real estate investors who want to invest in commercial and institutional-grade properties that they can't afford to invest in alone. 

Direct real estate can be an excellent investment.  However, it can also be a huge liability and time commitment, especially with the amount of hands-on work it requires.  Investing in commercial real estate is a fantastic way for investors to profit and diversify their portfolios, but investments like these are typically too expensive for individual investors.  Many variables need consideration, and what might seem like a simple investment could have unexpected implications.

However, DSTs make it possible for investors to access and invest in high-profile commercial real estate. DST investments are offered by sponsors who professionally manage a portfolio of properties for the passive or "fractional" investor.

The commercial real estate market presents a unique set of challenges for many investors.  To help investors navigate this landscape, we've created a guide that contains the necessary information about DSTs and how you can benefit from them.

What is a DST (Delaware Statutory Trust)?

A DST (Delaware Statutory Trust) is a property ownership arrangement in which several investors each possess uncontested fractional shares in the trust's assets.  According to the regulations of Delaware trust law, DSTs are legal entities.

A seasoned real estate firm, known as the sponsor, is in charge of finding and acquiring the property portfolio before establishing the Trust.  The money that the DST sponsor used to purchase the building gets replaced as investors make investments through 1031 exchanges, and ultimately the investors will own the property outright as the investors beneficially own the Trust. 


This indicates that investors possess a portion of the property and that no one entity owns any property component.  They qualify for 1031 exchanges when the investment is made and sold because the IRS recognizes each investor's holdings as actual ownership rights.

How Do Delaware Statutory Trusts Operate?

Delaware Statutory Trusts are investment vehicles, similar to LLCs or limited partnerships that investors use to own a fraction of a commercial or high-caliber property.  Simply put, a DST sponsor combines money from beneficiaries (usually accredited investors to invest in real estate).

The DST sponsor will have already purchased the commercial assets with its own money and created a trust to hold them.   Every investor acquires a pro-rata portion of ownership in a DST by investing in it.  This continues until each fractional investor owns the property that the DST initially purchased.

A person must be an accredited investor and be able to meet the typical $100,000 minimum investment required to become a DST beneficiary. 

DST investments give investors access to:

  • Industrial real estate
  • Medical offices
  • Multifamily buildings
  • Office buildings
  • Retail Properties
  • Self-Storage Units
  • Senior Living, etc.

The usual hold period for DST investments lasts between 5 and 7 years, though many DSTs have different time horizons.  Additionally, investors may be eligible for monthly or quarterly cash flow throughout this period.  The investors will get their proportionate share of the sales profits and any profits from future appreciation upon selling the property.

Expand Your Portfolio with High-Caliber Commercial Real Estate

Investors in the past needed professional experience, a strong network, and access to significant quantities of funds. These prospects were once only accessible to hedge funds, investment professionals, and the super-wealthy. However, now any Accredited Investor can benefit from such opportunities.

BV Capital promises attention to detail, experience, and expertise to generate wealth for accredited investors who partner with us.  You can eliminate the hassles associated with direct asset ownership while owning a fraction of institutional-grade properties.

contact us

How Do Delaware Statutory Trusts Operate?

Delaware Statutory Trusts are investment vehicles, similar to LLCs or limited partnerships that investors use to own a fraction of a commercial or high-caliber property.  Simply put, a DST sponsor combines money from beneficiaries (usually accredited investors to invest in real estate).

The DST sponsor will have already purchased the commercial assets with its own money and created a trust to hold them.   Every investor acquires a pro-rata portion of ownership in a DST by investing in it.  This continues until each fractional investor owns the property that the DST initially purchased.

A person must be an accredited investor and be able to meet the typical $100,000 minimum investment required to become a DST beneficiary. 

DST investments give investors access to:

  • Industrial real estate
  • Medical offices
  • Multifamily buildings
  • Office buildings
  • Retail Properties
  • Self-Storage Units
  • Senior Living, etc.

The usual hold period for DST investments lasts between 5 and 7 years, though many DSTs have different time horizons.  Additionally, investors may be eligible for monthly or quarterly cash flow throughout this period.  The investors will get their proportionate share of the sales profits and any profits from future appreciation upon selling the property.

Expand Your Portfolio with High-Caliber Commercial Real Estate

Investors in the past needed professional experience, a strong network, and access to significant quantities of funds. These prospects were once only accessible to hedge funds, investment professionals, and the super-wealthy. However, now any Accredited Investor can benefit from such opportunities.

BV Capital promises attention to detail, experience, and expertise to generate wealth for accredited investors who partner with us.  You can eliminate the hassles associated with direct asset ownership while owning a fraction of institutional-grade properties.

contact us

How DSTs Work With 1031 Exchanges

The IRS-approved arrangement known as a 1031 exchange enables real estate investors to defer paying taxes (including capital gains taxes, state income tax and depreciation recapture on the transfer of rental property).  DSTs are qualified for 1031 exchanges because, in the eyes of the tax code, they qualify as direct property ownership.


For a DST to qualify for a 1031 exchange, the sale profits of the transferred property must get invested into a like-kind replacement property of comparable or superior value. This is accomplished through a Qualified Intermediary who will hold the funds in escrow and document the process.  To defer tax, investors must ID a replacement property within 45 days and complete this transaction within 180 days of the old property's closing date. 


Tax deferral enables DST investors to keep the equity from the property sale, allowing them to use it to their advantage in their new DST property.

What Makes DSTs a Good 1031 Exchange Option?

Using Internal Revenue Code Section 1031 to your advantage can effectively increase your ROI in real estate.  While investors have traditionally used real estate to expand their portfolios, DSTs offer a passive and more streamlined and flexible approach to the same end.

Compliant with 1031 Exchanges

Every investor in a DST has a stake in the trust through their ownership interests.  A 1031 exchange is possible because the IRS considers the DST investor's ownership of the security equity share ownership.

The IRS issued Revenue Ruling 2004-86 in 2004, allowing the use of a DST to purchase the property.  The IRC Section 1031 recognizes each beneficiary in the trust as having a personal stake in the new property.

Professional Assistance

DST investments provide a unique opportunity for passive income from real estate investments.  In a DST, property investment managers with extensive knowledge oversee the property portfolio on the investors' behalf.

Investors can earn genuinely passive income from DSTs since they aren't in charge of overseeing the project freeing them up to spend their time on what they choose.

The Benefits and Drawbacks of DST Investments

DSTs are a popular investment strategy, and for a good reason.  They provide numerous benefits that make them an excellent investment option for 1031 investors, but DSTs aren't without their flaws.

How do you know which investments are suitable for you?  We'll cover the benefits and drawbacks of DST investments to help you decide if DSTs are suitable for you.

The Benefits and Drawbacks of DST Investments

DSTs are a popular investment strategy, and for a good reason.  They provide numerous benefits that make them an excellent investment option for 1031 investors, but DSTs aren't without their flaws.

How do you know which investments are suitable for you?  We'll cover the benefits and drawbacks of DST investments to help you decide if DSTs are suitable for you.

Benefits

  • Access to Class A Properties
  • Pre-packaged Securities
  • Great Timing for 1031 Exchanges
  • Diversity of Risks
  • Supports Estate Planning
  • Passive Investment
  • Limited Liability
  • Direct Property Ownership

Drawbacks

  • Fees
  • Limited Early Termination Options
  • Absence of control
  • Illiquidity

Benefits

  • Access to Class A Properties
  • Pre-packaged Securities
  • Great Timing for 1031 Exchanges
  • Diversity of Risks
  • Supports Estate Planning
  • Passive Investment
  • Limited Liability
  • Direct Property Ownership

Drawbacks

  • Fees
  • Limited Early Termination Options
  • Absence of control
  • Illiquidity

The Benefits of Delaware Statutory Trusts

Access to Class A Properties 

While DSTs typically can own any type or class of real property, most assets they hold are of institutional standard. DSTs include many common commercial real estate properties such as multifamily, office, industrial and medical properties. They can even include A-list homes in affluent secondary markets and properties in significant urban regions.

Great Timing for 1031 Exchanges

Timing is a crucial factor for conducting 1031 exchanges. Investors have only 45 days after closing the sale of their surrendered assets to designate like-kind properties formally. It can be challenging to identify the right property in a lucrative market in time, which is one reason  DSTs are highly attractive to 1031 exchange investors.

 


DST sponsors provide a pre-packaged investment vehicle with low transactional risks. The sponsors handle assessments, accounting records, due diligence, environmental reports, and leases before they ever ask passive investors to pool their funds together. Consequently, exchange investors can do their due diligence immediately and satisfy the 45-day ID deadline and the 180 days required by the 1031 exchange laws.

Supports Estate Planning

DST investors can transfer their valuable ownership stake into the Trust in favor of their beneficiaries after investing the proceeds of a property sale into the DST. The real estate holdings kept in that trust acquire a stepped-up basis at the owner's death, which means that the property's value is calculated based on the owner's death date instead of the value at its initial purchase.

Pre-packaged Securities

It is reasonably easy for investors to employ 1031 exchange money to buy one or more partial DST investments because funding and complete due diligence are in place, allowing for quick closure.

Diversity of Risks 

The minimum investment amount for DSTs is typically $100,000. Therefore, accredited real estate investors can distribute their risk by working with various DST sponsors, different property types, and different geographic locations. You can invest $100,000 or more in a DST deal that focuses on industrial or retail properties and another $100,000 or more in another DST that focuses on multifamily or office buildings.

Passive Investment

DST investments provide a unique opportunity for passive income from real estate investments. In a DST, property investment managers with extensive knowledge oversee the property portfolio on the investors' behalf. Investors can earn genuinely passive income from DSTs since they aren't in charge of overseeing the project freeing them up to spend their time on what they choose.

Limited Liability

The DST structure protects investors from personal obligations that go beyond their investment.

Direct Property Ownership

Investing in DSTs has similar tax advantages to sole ownership, such as interest expense and asset depreciation.

The Benefits of Delaware Statutory Trusts

Access to Class A Properties 

While DSTs typically can own any type or class of real property, most assets they hold are of institutional standard. DSTs include many common commercial real estate properties such as multifamily, office, industrial and medical properties. They can even include A-list homes in affluent secondary markets and properties in significant urban regions.

Great Timing for 1031 Exchanges

Timing is a crucial factor for conducting 1031 exchanges. Investors have only 45 days after closing the sale of their surrendered assets to designate like-kind properties formally. It can be challenging to identify the right property in a lucrative market in time, which is one reason  DSTs are highly attractive to 1031 exchange investors.

 

DST sponsors provide a pre-packaged investment vehicle with low transactional risks. The sponsors handle assessments, accounting records, due diligence, environmental reports, and leases before they ever ask passive investors to pool their funds together. Consequently, exchange investors can do their due diligence immediately and satisfy the 45-day ID deadline and the 180 days required by the 1031 exchange laws.

Supports Estate Planning

DST investors can transfer their valuable ownership stake into the Trust in favor of their beneficiaries after investing the proceeds of a property sale into the DST. The real estate holdings kept in that trust acquire a stepped-up basis at the owner's death, which means that the property's value is calculated based on the owner's death date instead of the value at its initial purchase.

Pre-packaged Securities

It is reasonably easy for investors to employ 1031 exchange money to buy one or more partial DST investments because funding and complete due diligence are in place, allowing for quick closure.

Diversity of Risks 

The minimum investment amount for DSTs is typically $100,000. Therefore, accredited real estate investors can distribute their risk by working with various DST sponsors, different property types, and different geographic locations. You can invest $100,000 or more in a DST deal that focuses on industrial or retail properties and another $100,000 or more in another DST that focuses on multifamily or office buildings.

Passive Investment

DST investments provide a unique opportunity for passive income from real estate investments. In a DST, property investment managers with extensive knowledge oversee the property portfolio on the investors' behalf. Investors can earn genuinely passive income from DSTs since they aren't in charge of overseeing the project freeing them up to spend their time on what they choose.

Direct Property Ownership

Investing in DSTs has similar tax advantages to sole ownership, such as interest expense and asset depreciation.

Limited Liability

The DST structure protects investors from personal obligations that go beyond their investment.

The Downfalls of Delaware Statutory Trusts

Fees

DST investing fees are frequently imposed upfront and once more at the sale. Selling charges, broker-dealer allowances, offering and coordination costs, capital financing, and sale fees, among other things, are some examples of fees in a DST deal.

Illiquidity

DSTs are highly illiquid investments because of their extensive investment horizon, typically between five and ten years. The DST offering's growth cycle will likely have your capital tied up. Thus, only those investors who can bear having their investment held up for 5-7 years should consider investing in DSTs.

Limited Early Termination Options

Since there is no open market for divestment like there is for shares or other instruments, it can be very challenging to sell shares of a DST before the whole term of the deal.


Additionally, DSTs frequently impose limitations on the transfer of equitable interests, so you might need to obtain consent from the DST sponsor. Lastly, divestiture must adhere to securities rules because DST interests are considered private.

Absence of control

The DST business model may frustrate investors looking for hands-on opportunities where they can use their expertise to drive up asset valuations or lease rates.

 

DSTs are usually undertaken assets, and DST sponsors make all daily and critical operational decisions whereas passive investors have no input. You should ensure those factors are consistent with your financial beliefs.

The Downfalls of Delaware Statutory Trusts

Fees

DST investing fees are frequently imposed upfront and once more at the sale. Selling charges, broker-dealer allowances, offering and coordination costs, capital financing, and sale fees, among other things, are some examples of fees in a DST deal.

Illiquidity

DSTs are highly illiquid investments because of their extensive investment horizon, typically between five and ten years. The DST offering's growth cycle will likely have your capital tied up. Thus, only those investors who can bear having their investment held up for 5-7 years should consider investing in DSTs.

Absence of control

The DST business model may frustrate investors looking for hands-on opportunities where they can use their expertise to drive up asset valuations or lease rates.

 

DSTs are usually undertaken assets, and DST sponsors make all daily and critical operational decisions whereas passive investors have no input. You should ensure those factors are consistent with your financial beliefs.

Limited Early Termination Options

Since there is no open market for divestment like there is for shares or other instruments, it can be very challenging to sell shares of a DST before the whole term of the deal.


Additionally, DSTs frequently impose limitations on the transfer of equitable interests, so you might need to obtain consent from the DST sponsor. Lastly, divestiture must adhere to securities rules because DST interests are considered private.

Fees Associated With DSTs

A DST must pay many underwriting and administrative fees when purchasing property and setting up the trust, just like other real estate investments.  At the time of the offering, these expenses get repaid to DST sponsors as they were paid by the Sponsor initially.

Listed are some of the most typical fees associated with a DST:

  • Due diligence on the purchased property by sponsors 
  • Obtaining a due diligence report from a third party
  • Commissions for marketing and distribution
  • Origination fees for loans
  • Reserve quantification through structural reports
  • Acquiring a tax letter to verify that the Trust is eligible for 1031 Tax-deferred exchanges

The sponsoring entity can not take part in any potential appreciation of the Trust's property investment(s) upon sale, according to the IRS-mandated structure for DSTs.  Therefore, in addition to the purchase and development fees, DST sponsors may also be qualified for a share of the properties' continued cumulative operating revenue.

Who Can Invest in DSTs?

DSTs are specialized investments, and to participate in one, you need to be an accredited investor. According to the SEC, an accredited investor has $1,000,000 in assets (excluding their principal residence); or an average yearly income of more than $200,000 for the previous two years, whichever is higher; or $300,000 for a married couple filing together.

Finding DST Properties

Finding a DST could be the biggest obstacle when it comes to investing in one.  Due to SEC guidelines, sponsors are limited in how they promote some DST investments to the general public.  However, DST sponsors provide accredited investors with the opportunity to invest in high-profile properties by directly collaborating with brokers and 1031 experts.

The screening, purchase, and management of the properties included in each Delaware Statutory Trust are the responsibility of real estate companies referred to as DST sponsors.  After purchasing the DST property, various parties conduct due diligence on the real estate and trust arrangement. 

The sponsors arrange the DST deal for investors and advertise it through authorized broker dealers and RIAs who hold the required brokerage licenses to conduct DST sales on behalf of customers.

Diversify your Investment Portfolio with Private Real Estate

To keep your money growing long-term, you need to diversify your investments. And what better way to diversify your portfolio than investing in institutional-quality properties with no ongoing investor responsibilities.  


At BV Capital, we provide a unique opportunity for accredited investors to invest in historically-unavailable A-list real estate. Our partner broker dealer firms carefully assess all DST sponsors and offerings ensure the investment possibilities offered align with our investor's goals.

contact us
view our dst offering
table of contents
Why Consider a DST Investment?
What is a DST (Delaware Statutory Trust)?
How Do Delaware Statutory Trusts Operate?
How DSTs Work With 1031 Exchanges
What Makes DSTs a Good 1031 Exchange Option?
The Benefits and Drawbacks of DST Investments
Fees Associated With DSTs
Who Can Invest in DSTs?
Finding DST Properties

Diversify your Investment Portfolio with Private Real Estate

Dallas Design District DST Location

To keep your money growing long-term, you need to diversify your investments. And what better way to diversify your portfolio than investing in institutional-quality properties with no ongoing investor responsibilities.  


At BV Capital, we provide a unique opportunity for accredited investors to invest in historically-unavailable A-list real estate. Our partner broker dealer firms carefully assess all DST sponsors and offerings ensure the investment possibilities offered align with our investor's goals.

contact us
view our dst offering

The post The Real Estate Investor’s Guide to DST Investments and 1031 Exchanges appeared first on BV Capital.

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