July 15th 1031 Exchange Deadline Approaching! How Fast Can I Close on DSTs?

By: Orrin Barrow, Vice President – Kay Properties and Investments, LLC

Many investors were granted an extension on their 1031 exchanges so that they would not have to identify their replacement property until July 15th, 2020. However, we are quickly approaching this deadline for investors to properly identify and select their replacement property. Given the very unsure nature of the economy and how Covid-19 will continue to affect us, many investors have been reaching out to Kay Properties to look for Delaware Statutory Trust properties for sale that can either serve as a backup strategy or as a property that they can identify and can quickly close on considering the July 15th deadline. 

Many Delaware Statutory Trust properties for sale are actually purchased outright by the DST sponsor company before they are reviewed by our in-house due diligence analysts and uploaded to the kpi1031.com platform. This results in potentially reduced closing risk for investors while also giving them the ability to close on their replacement property in as little as 48-72 hours after reading the Private Placement Memorandum (PPM), speaking with their CPA and attorney as well as discussing the potential risk factors of making an investment with a Kay Properties team member.

There are also many DST properties for sale on the kpi1031.com platform that will potentially have equity remaining for roughly 60-120 days. This allows for investors to potentially select a DST 1031 property to serve as a backup identification to their primary selections. Another drawback of Covid-19 is that many clients are hindered or unable to go and see properties due to statewide ordinances or airport travel restrictions. This makes it more difficult for investors to perform due diligence as they normally would before selecting properties for their 1031 identification. Having the Delaware Statutory Trust and the additional due diligence that Kay Properties has done as a backup strategy can possibly prevent investors from having a failed exchange. If an investors primary property has issues that the investor just isn’t comfortable with, they could potentially easily close into their selected DST 1031 back up.

In conclusion, DST properties are often quickly closed on in the event that a client is looking to complete their 1031 exchange before the 45th day identification deadline and also readily available to serve as backup solutions for a client who is brushing up against their timeline and needs a potential back up strategy. Be sure to speak to your Kay Properties representative to learn more about DST 1031 properties for sale and solutions as well as visit www.kpi1031.com.

About Kay Properties and www.kpi1031.com 

Kay Properties is a national Delaware Statutory Trust (DST) investment firm. The www.kpi1031.com platform provides access to the marketplace of DSTs from over 25 different sponsor companies, custom DSTs only available to Kay clients, independent advice on DST sponsor companies, full due diligence and vetting on each DST (typically 20-40 DSTs) and a DST secondary market.  Kay Properties team members collectively have over 115 years of real estate experience, are licensed in all 50 states, and have participated in over 15 Billion of DST 1031 investments.

This material does not constitute an offer to sell nor a solicitation of an offer to buy any security. Such offers can be made only by the confidential Private Placement Memorandum (the “Memorandum”). Please read the entire Memorandum paying special attention to the risk section prior investing.  IRC Section 1031, IRC Section 1033 and IRC Section 721 are complex tax codes therefore you should consult your tax or legal professional for details regarding your situation.  There are material risks associated with investing in real estate securities including illiquidity, vacancies, general market conditions and competition, lack of operating history, interest rate risks, general risks of owning/operating commercial and multifamily properties, financing risks, potential adverse tax consequences, general economic risks, development risks and long hold periods. There is a risk of loss of the entire investment principal. Past performance is not a guarantee of future results. Potential cash flow, potential returns and potential appreciation are not guaranteed.

Nothing contained on this website constitutes tax, legal, insurance or investment advice, nor does it constitute a solicitation or an offer to buy or sell any security or other financial instrument. If you are not the intended recipient of this message, any use, dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify the sender and permanently delete all copies that you may have. Securities offered through Growth Capital Services, member FINRASIPC, Office of Supervisory Jurisdiction located at 582 Market Street, Suite 300, San Francisco, CA 94104.

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