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What is a Delaware Statutory Trust (DST)?

A Delaware Statutory Trust (DST) is a legally recognized trust that is created under the laws of the state of Delaware in the United States. It is a specific type of trust that is often used in real estate investing as a way to hold title to real property.

In a DST, investors pool their money together to buy a property, which is then held by the trust. The trust is managed by a trustee, who is responsible for making decisions on behalf of the trust and distributing any income or proceeds from the property to the investors.

One of the key advantages of a DST is that it allows investors to own a fractional interest in a large, professionally managed property, without having to deal with the day-to-day management of the property themselves. This can be particularly appealing to investors who want exposure to the real estate market but don’t want to deal with the hassle of property management.

DSTs are typically used for larger commercial properties, such as apartment buildings, office buildings, or shopping centers, but they can also be used for smaller properties as well. They are also commonly used in 1031 exchanges, which are tax-deferred ways to sell one investment property and reinvest the proceeds into another investment property.