DST Fundraising Ticks Up Over the Summer

As of Aug. 31, 2024, the year-to-date equity raise for Delaware statutory trust offerings was just less than $3.5 billion, inclusive of the approximately $493.1 million raised throughout the month, according to Mountain Dell Consulting.

The equity raised in August 2024 reflected a 9.9% decrease on the previous month’s $547.3 million, but industry fundraising as a whole experienced a significant uptick during the summer months of June, July, and August. Through May, DST fundraising was averaging just $387,000 per month but accelerated significantly to an average monthly raise of more than $516,000 beginning in June.

The industry is now on pace to raise more than $5.2 billion in 2024, which would be a slight increase over the $5.04 billion raised in 2023.

As a whole, the industry continues to struggle with sluggish sales, which is generally attributed to the rise in interest rates and subsequent inertia in the pace of commercial real estate transactions. In 2021, DST sponsors raised $7.2 billion, a record year, smashed just a year later when DSTs attracted approximately $9.2 billion in 2022.

The top five sponsors, i.e., those representing the highest percent of market share through the end of August 2024 were as follows, according to Mountain Dell.

Ares Real Estate Exchange led sales with a total equity raise of approximately $615.9 million (18% of market share).

Inland Private Capital Corporation’s August year-to-date tally was nearly $397.1 million (11%).

JLL Exchange’s August year-to-date tally was nearly $381.8 million (11%).

ExchangeRight Real Estate’s August year-to-date tally was approximately $228.5 million (7%).

Hines Real Estate Exchange rounded out the top five with a total equity raise of nearly $201.8 million (6%).

As of the end of August, 46 active sponsors were sponsoring 82 programs, according to Mountain Dell. The average days on market was 299 days. Multifamily and industrial were the most popular asset types, comprising 65% of all syndicated offerings.

Located in the Salt Lake City region, Mountain Dell Consulting is a consulting and research firm focused on real estate-oriented investment programs. It has sourced and compiled data on the securitized 1031 exchange market since 2003.

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