Delaware Statutory Trust (DST) and Tenants in Common (TIC) are both investment structures that allow multiple individuals to own a fractional interest in a property. However, there are some key differences between the two.
Delaware Statutory Trust (DST):
- A DST is a type of trust established under Delaware law that holds title to a property and allows multiple investors to own a fractional interest in the property.
- The trust is managed by a trustee, who is responsible for making decisions regarding the property and managing day-to-day operations.
- DST investments offer investors the ability to invest in institutional-quality properties with a lower minimum investment amount.
- DSTs are typically passive investments, meaning that investors have limited control over the property and decision-making.
Tenants in Common (TIC):
- TIC is a form of joint ownership where each individual owns a specific percentage of the property.
- TIC owners have more control over the property and decision-making, as they are co-owners of the property.
- TIC ownership may involve more responsibilities and involvement compared to DST ownership, such as the need to manage the property and make decisions regarding operations.
- TIC ownership may also require more capital, as each individual must purchase their own share of the property.
In summary, the main differences between DSTs and TICs are the level of control and involvement the investor has in the property, the minimum investment required, and the responsibilities involved in ownership. Both types of investments can offer the benefits of fractional ownership and the potential for real estate investment returns, but it is important to consider the specific differences and choose the investment structure that best aligns with your investment goals and risk tolerance.