Also known as unincorporated Business Trusts (UBOs),
DSTs began in 2004. They have become one
of the major sources of investment for accredited investors due to numerous
advantages.
Some of these advantages include:
Replacement
property in 1031 exchange
The primary advantage of the DST is that it can be
utilized as a replacement property for 1031 exchange.
Diversification
of portfolio
The investors are able to choose multiple DST
properties during 1031 exchange that results in diversification in terms of
cities and asset classes, etc.
The minimum investments for DSTs are as low as 100,000
dollars of equity for 1031 exchange. On the other hand, the cash investments in
DST can be as low as 25,000 dollars.
Maintaining
an LLC is not required
The investors don’t have to pay annual state filing
fees as they are not required to maintain an LLC.
Unanimous
Owner Approval is not needed
Unlike Tenancy-in-common (TIC), a DST does not require
unanimous approval of the investors while dealing with unexpected situations.
Financing
is easy
As the lender treats the trust as the only borrower, it
becomes quite economical and easier to obtain financing. Also, the
participation of individual investors does not impact the credit rating.
If you are looking for a suitable DST as an investment property in the USA, you can rely on FAI 1031. We are a team of experts with
in-depth and experience on DST investment and 1031 exchange.
To know more about DST properties, visit this link.
