Description
Commercial real estate investment vehicles like 1031 exchanges and now Delaware Statutory Trusts (DSTs) are gaining more attention and increasing in popularity due to the greater income potential, competitive risk-adjusted returns, and the significant tax benefits they offer. While many real estate practitioners are well-versed on 1031 exchanges, many remain unfamiliar with DSTs - an investment vehicle that has existed for a while but became more attractive after the 2008-2009 financial crisis. DSTs, which are used for passive ownership in institutional-quality assets at a comparatively low minimum investment cost, offer great investment potential for investment clients. However, they are complex vehicles and transactions to execute, posing several pitfalls and traps for the unwary. Take this course so you can step over these transaction landmines!
Taught by three nationally recognized practitioners well-versed in real estate investment and tax matters, this course will break down DST fundamentals so that you and your client are well-informed and prepared to embark on DST investment deals. Over the course of 90-minutes, you will analyze these important deal considerations:
DST requirements from a tax perspective and why these work in a 1031, understanding Revenue Ruling 2004-86 and additional restrictions beyond the “seven deadly sins”
Understanding how DSTs differ from tenancy-in common (TICs) structures: Benefits and disadvantages in using DSTs versus TICs
The asset types that are ideally suited for the use of DSTs: The institutional-grade commercial properties for which DSTs may be the ideal structure to acquire, hold, finance and sell.
How to structure and govern a DST: Organizational, management, and control considerations
Financing a DST and workout considerations: Limitations on the authority of DST trustees, special considerations if a master lease structure is used and avoiding “tax traps” that could impair treatment as real estate for purposes of Code Section”
Solutions and other options when things go wrong: Practical deal pressure points, strategic considerations, and unique issues