Investment Grade Property Alternatives and DSTs From Sera Capital
Our Approach to DSTs
We offer a seamless solution for your 1031 exchange. The 45-day identification period moves very quickly and often creates needless stress. Our experienced team of securities and real estate professionals monitor daily the available Delaware Statutory Trusts in the marketplace. This means that at any time you can have access to a fully-vetted, investment grade real estate alternative. And our process makes for a seamless and straightforward 1031 exchange as well.Learn More
Own a Fractional Interest
One of the greatest benefits of selecting a Delaware Statutory Trust as a 1031 Replacement Property is being able to select the exact undivided interest which meets the financial requirements of your exchange. You determine how much you want to invest as well as how much debt you want the DST sponsor to assign to you.
Obviously this means that you will be owning the property with other similarly situated investors and you will be receiving your portion of the property rents every month as well as the tax benefits.
Your Debt is Replaced For You
One of the important requirements for a 1031 exchange is to replace your debt. A DST removes the headache out of arranging and qualifying for new financing since the DST sponsor has already arranged and qualified for the non-recourse financing for you.
DST sponsor secures non-recourse financing at favorable terms.
DST sponsors are established investment real estate firms with strong lender relationships. This allows them to obtain very favorable terms which most investors can't duplicate.
DST assigns you a pro-rata share of debt for your 1031 exchange.
The DST qualifies for the loan and always possess the loan obligation. However, 1031 exchange purposes they can assign a ratable amount to you.
You can now relax because the 1031 debt is handled for you!
Many investors panic when they realize they much qualify for a new loan and be responsible for debt services. That worry is now gone forever!
Types of Delaware Statutory Trusts
One of the most popular type of properties which make their way into Delaware Statutory Trust portfolios are multi family apartment units. Historically these properties, when located in growing areas with a diverse population and economy, have provided the most stable income as well as longer term equity growth.
Mixed Use Retail
Many of the newer mixed use types of properties which contain retail as well as residential units or lofts are already owned by Delaware Statutory Trusts. This mixed use approach allows for good tax shelter, diversification of risk as well as opportunities for rent increases in certain pivotal markets.
Student housing has traditionally worked well for Delawarse Statutory Trust interest owners. This is because larger complexes located near major universities provide a regular flow of tenants and a stable ability to schedule regular rent increases.In addition the student populace drives a low vancy factor.
Selecting Your DST Properties
Since a Delaware Statutory Trust (DST) allows you to co-invest with other 1031 exchange investors in one or numerous institutional-grade properties. At the time you make a property selection from those available you are assigned a fractional ownership of equity and debt, fulfilling your 1031 exchange requirements. As a DST interest owner you will regularly receive an IRS Form 1099 for your ordinary income, an IRS Form 1098 for your share of mortgage interest write-off, as well as an operating statement which details profit & loss and depreciation.
Let's discuss Delaware Statutory Trusts!