Delaware Statutory Trust (DST)
A Delaware Statutory Trust is a fractional, fully passive 1031-eligible alternative (or complement) to direct NNN ownership. The sponsor manages the asset and pre-arranges financing; investors buy fractions ($100K–$500K) and can close in days, which helps when the 45-day identification window is hard to meet. The trade-off is no control, sponsor/management fees, and limited exit flexibility.
Key Points¶
- Lower minimums and near-instant closing vs. direct ownership's hard 180-day deadline.
- Truly passive — sponsor selects tenants and manages; investor has no control.
- For this group's scale ($20M+), direct ownership is standard; a hybrid (3 direct NNN + 1 DST to absorb leftover equity) is a possible tactic.