Kay Properties & Investments President, Chay Lapin, reviews the debt-free Texas Small Bay 85 DST for 1031 exchange and direct cash investors.

The 68,400 SF asset was constructed in 2000 and is a 100% leased multi-tenant flex/industrial asset located in the coveted northwest submarket of San Antonio, Texas.

One of the most important questions Delaware Statutory Trust real estate investors
need to ask themselves is, “What is my long-term, exit strategy?”
Most Delaware Statutory Trust (DST) investments are typically held for approximately 5-
10 years (although it could be shorter or longer). After that, the DST investment will
typically go “Full-Cycle”, a term used to describe a DST property that is purchased on
behalf of investors and then after a period of time is sold on behalf of investors.
Once your DST investment goes full-cycle, investors need to evaluate what their next
investment move should be. For example an investor could simply cash out and pay the
capital gains and other taxes, enter another 1031 Exchange process, or complete a 721
Exchange UPREIT.

For real estate investors considering Delaware Statutory Trust (DST) investments—whether for a 1031 exchange or as a direct cash investment, it is important to define your investment strategy. For example, are you looking for an investment where you have the abilitiy to potentially generate greater monthly net operating income, or are you more interested in a steady income stream over a long period of time. These two investment strategies are often called the “Anchor and Buoy” investment theory.

DSTs are uniquely suited to help investors potentially achieve the benefits of both strategies, potentially offering the stability of an anchor with the growth opportunities of a buoy.