By Dwight Kay, CEO & Founder at Kay Properties & Investments
5
1414 ratings
The podcast currently has 114 episodes available.
Navigating the nuances of 1031 exchanges can be confusing for real estate investors, especially when it comes to understanding the concept of debt replacement. In today's podcast, Kay Properties' Senior Vice President's Matt McFarland and Carmine Galimi take a deep dive into why many investors love the Delaware Statutory Trust for replacing 1031 Exchange debt.
This podcast features two actual investors who share how they turned to Kay Properties and Investments when they decided to exit the world of active management of their multifamily real estate portfolio and the the "Terrible Three T's: Tenants, Toilets, and Trash".
*These testimonials may not be representative of the experience of other clients. These clients were not compensated for their testimonials. Please speak with your attorney and CPA before considering an investment.
Real estate investors love Delaware Statutory Trusts for their 1031 exchanges because they can potentially provide investors the opportunity to defer capital gains taxes, eliminate active management responsibilities, and achieve the potential for regular monthly cash distributions. However, the first step to using the DST 1031 exchange real estate investment strategy is to first understand the pros and cons of the Delaware Statutory Trust.
Jason Salmon, Executive Vice President and Managing Director along with Orrin Barrow, Senior Vice President with Kay Properties jump directly into very specific advantages and disadvantages of Delaware Statutory Trusts and provide listeners a comprehensive view into this popular investment strategy.
Key Takeaways:
A Closer Look at Essential Net Lease 81 and San Antonio Multifamily 74 DSTs
Chay Lapin, President of Kay Properties & Investments describes two new debt-free Delaware Statutory Trusts offerings that include the Essential Net Lease 81 DST and the San Antonio Multifamily 74 DST.
One of the more complex strategies 1031 exchange investors should be aware of is the Zero Coupon DST 1031 Exchange.
Listen to Kay Properties Senior Vice President Alex Madden and Vice President Tim Emanuel describe how investors can use the Zero Coupon strategy for the Delaware Statutory Trust 1031 exchange.
It’s been called the greatest wealth transfer in history - It is estimated that $84 trillion in assets is set to change hands over the next 20 years. Not surprisingly, real estate accounts for the vast percentage of this wealth.
The Delaware Statutory Trust can be a great tool for helping investors preserve their wealth and pass their assets to the next generation.
Kay Properties & Investments senior vice presidents Alex Madden and Matt McFarland explain exactly how Delaware Statutory Trusts can help investors with wealth preservation.
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. While the two most common exit strategies for DST investors include cashing-out and paying taxes or continuing with another 1031 Exchange, a third optiion exists for investors in the form of a 721 UPREIT.
What is a 721 UPREIT Exchange?
The term “UPREIT” is short for Umbrella Partnership Real Estate Investment Trust, which is an operating partnership subsidiary of a REIT that holds and operates real property. Section 721 of the Internal Revenue Code allows owners of real estate property to contribute, on a tax deferred basis, their physical property to a partnership, in exchange for interests in the partnership ( a 721 Transaction). This structure allows holders of real estate to exchange real property for economic interest in the REIT in the form of operating partnership units by contributing that property to the partnership in a 721 Transaction. The operating partnership units have economic rights that are identical to the rights of the shares of the REIT, and after a designated holding period can be, if the investor chooses to, converted into shares of the REIT (in a taxable transaction) for liquidity purposes. Investors seeking to defer capital gains taxes while increasing diversification in real estate should consider using a 721 Exchange to realize the several potentail benefits that are explained in this informative podcast episode by Kay Properties.
Kay Properties & Investments Betty Friant, Managing Director and Executive Vice President and Matt McFarland, Senior Vice President discuss in detail two current debt-free DST offerings from Kay Properties & Investments.
Debt-Free DST Offering Number One:
The first offering is for a Pepsi Distribution DST 64. This Net Lease Distribution DST is located in Frankfort, NY and is a 61,000 square foot industrial building with brand new construction. This asset has a current 10 year net lease on the property and is eligible for a 721 Exchange Rollup as a potential exit strategy.
Debt-Free DST Offering Number Two:
The second offering is for Florida Net Lease 72 DST. This asset currently has a new 20-year net lease in place that is corporately guaranteed with annual rental increases. Located in the Miami MSA, this net lease is for a Guidepost Montessori school.
Listen to Kay Properties & Investments Chay Lapin discuss in detail three current offerings available from Kay Properties.
These offerings include:
Offering Number One:
A debt-free multi-tenant retail location in Birmingham, AL. This offering is called Eastwood Village Opportunity 71 DST and includes a portfolio of discount retail locations located in Birmingham, AL. This 130,056 square foot retail offering is 96% leased and includes national tenants as Ross, Five Below, Office Depot, Michael's, Party City, and more. The asset sees 78,000 vehicles per day and 3.4 million people visiting the center annually.
Offering Number Two:
A debt-free multi-tenant flex asset located in Fort Bend County, a suburb of Houston. This asset, called Rogers Business Park DST is a newly constructed facility that currently is 99% leased to a wide range of tenants including retail, restaurants, business offices, and warehouse space.
Offering Number Three:
A senior preferred equity real estate fund offering. This direct cash investment currently has a portfolio of more than 1.9 million square feet throughout 24 buildings across five Southeastern states. This fuknd is offering a senior preferred equity offering whereby fresh capital holds a senior position to the current portfolio owners equity.
Real estate investors have three options when purusing a 1031 exchange. First, they could simply exchange into a similar property as they relinquished with the intent on continuing to actively manage the asset. Second, they could directly purchase a NNN property that they would also manage on their own. Third, invest in a Delaware Statutory Trust where they would enter as 100% passive management role and potentially receive regular monthly dispursements.
The podcast currently has 114 episodes available.
152,733 Listeners