Welcome to DST 1031 Essentials with Kay Properties — An in-depth look at the many recurring themes and nuances to the Delaware Statutory Trust (DST) investment process.
Topics will cover 1031 exchanges, ins and outs of the Delaware Statutory Trust structure, timing, cash investing, REITS, funds, real estate, and more.
The kpi1031.com platform not only provides access to these 25+ different sponsor companies, but also custom DSTs only available to Kay clients, full due diligence, and vetting on each DST property on the platform (typically 20-40 DSTs), and an active DST secondary market. Kay Properties team members collectively have over 150 years of real estate experience, are licensed in all 50 states, and have participated in over 30 Billion of DST 1031 investments
In this week's episode, Vice President Matt McFarland and Vice President Alex Madden dive into the importance of debt, how it works, and what are their advantages and potential risks in a 1031 exchange. Debt can be used as a powerful tool, but it is not without its risks.
Key Takeaways:
[0:45] Risks and disclosures.
[3:25] About Kay Properties & Investments.
[4:10] Matt introduces Alex and today's topic.
[5:00] How does debt work from a 1031 exchange? What are their advantages and potential risks?
[6:25] Why is debt important in a 1031 exchange? Alex explains and describes the process of replacing debt.
[7:15] When you sell a property and you intend to do a 1031 exchange, the regulations state you must purchase equal or greater value from what you sold. Alex shares some examples.
[9:15] How does debt replacement work when it comes to investing in a DST?
[10:10] DST investors do not need to provide financial information. Alex explains how they are not personally liable for their non-recourse loans.
[12:45] Matt adds that the DST is going to be acquired by the DST sponsor company prior to it being offered.
[14:40] What are some of the advantages and disadvantages when it comes to taking on debt in a DST? Alex shares what things investors should be aware of.
[15:50] Some investors like to have debt to be potentially more streamlined from a tax perspective.
[17:45] Debt comes with risk and DSTs are no exemption. Alex shares what risks could look like in the DST structure.
[19:55] Taking on more debt is not always the right decision especially when you're moving into retirement. Alex explains further why.
[21:50] Debt is not bad but it's important to understand the risk that is involved.
[23:45] Matt also adds another advantage with DST which is flexibility. He shares further why so.
Resources
Website: https://www.kpi1031.com/
Call Kay Properties at 855-899-4597
Meet the Kay Properties Team: kpi1031.com/meet-our-team
About Kay Properties and www.kpi1031.com
Securities offered through FNEX Capital member FINRA, SIPC. Potential returns and appreciation are never guaranteed and loss of principal is possible. Please speak with your CPA and attorney for tax and legal advice.
