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ADISA Publishes Best Practices for DST 1031 Exchanges

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The Alternative and Direct Investment Securities Association has published A Guide to DST 1031 Best Practices (2022), a manual designed to highlight certain best practices related to Delaware statutory trusts, the preferred structure used to facilitate securitized 1031 exchanges.

“1031 exchanges are increasingly popular tax-advantaged investments and are projected to raise more than $8 billion in investor equity in 2022,” said John Harrison, ADISA’s executive director. “As more investment sponsors enter the 1031 market, ADISA sought to provide a set of best practices for these sponsors, as well as investors and advisors who are evaluating a possible offering. This guide was a collaborative effort between industry participants, including ADISA’s Standards, Education & Publications Committee, and volunteer members comprised of financial advisors, sponsors, attorneys and more. We are extremely proud of this publication and grateful to the volunteers for their efforts.”

ADISA first published best practices for tenant-in-common structures in 2006, when TICs were the dominant structure used in securitized 1031 exchange offerings.

A Guide to DST 1031 Best Practices (2022) covers a variety of topics related to DSTs and 1031 exchanges, including the history and foundational principles; like-kind exchanges; private placement memorandums and disclosures; due diligence; DST securities practices; and general DST restrictions, benefits, and structures.

The guide is intended for use by investment sponsors, broker-dealers, registered representatives, investment advisors, attorneys, certified public accountants, qualified intermediaries, other professional advisors, and investors.

The DI Wire and ADISA are co-hosting a webinar to discuss the newly published best practices on Dec. 6, 2022 at 1pm ET. You may register for the webinar here.

The panel is comprised of several of the principal authors of the newly published best practices, including Darryl Steinhause, partner at DLA Piper, Taylor Garrett, managing director at Mountain Dell Consulting and Michael Bendix, co-founder and chief executive officer at DFPG Investments.

You may download ADISA’s A Guide to DST 1031 Best Practices here.

For more ADISA news, please visit their directory page.