1031 Exchange - DST?

[Chris Stratton]

Hi - we're getting ready to "push the button" with Kay Properties on a 1031 finance purchase of a $100,000 offering. Still doing a little Due Diligence. This will be a first DST purchase for us, and the 3rd time involved with a 1031 exchange. Two questions come to mind: 1) does anyone have any experience with Kay Properties? If so - how did that go? 2) how are "assessments" handled w/ a DST? in other words, if the roof blows off a FedEx building, do they typically get a loan to replace it, or are the investors assessed? TIA!

Chris

[Chris Stratton]

Hi Guy,

We did buy into a couple of units with a DST vendor (Kay Prop). Experience has been positive, and we've had excellent service from Kay Properties. One was a straight-up purchase, the other included a loan component. The "loan component" means, I believe, that on selling, my basis is higher, so to continue, I would have to buy another loan component DST or face some same-year tax consequence. The 'buy in' costs are high, no doubt. The checks have, so far, just kept rolling in. We had a very slight increase recently in the smaller of the two investments. Honestly, not sure I would go/do something else different if these ended. Chris