The Growing Appeal Of Delaware Statutory Trusts

Brad Watt

LAS VEGAS–Kingsbarn Realty Capital recently closed on a six-asset healthcare portfolio fully occupied by long-term net leases. Its next step: to pool these properties, which are located in South Carolina, Kentucky, Wisconsin, Tennessee and Pennsylvania, in a vehicle that is becoming increasingly popular with 1031 exchange investors: a Delaware Statutory Trust, or DST. As is the case with these structures, Kingsbarn’s sponsor, KB Exchange Trust, will offer these properties on a fractional ownership basis to accredited investors such as 1031 exchange buyers.

As for Kingsbarn, that is its MO: acquiring credit-tenant properties in the healthcare sector, which it then pools into portfolios that are structured DSTs. Its real estate investment programs are offered through Triloma Securities.

What Are DSTs?

If you have to ask, you are not alone. In spite of their popularity, many investors, tax advisors and other financial intermediaries have never heard of DSTs, Brad Watt, managing director of Kingsbarn Realty Capital tells GlobeSt.com.