After relinquishing a portion of his large industrial real estate portfolio, investor is referred to Kay Properties to help develop long-term DST investment strategy designed to diversify* his concentration in industrial real estate, create passive income potential, and potentially hedge against inflation.
TORRANCE, Calif., Feb. 14, 2023 /PRNewswire/ — Kay Properties & Investments announced it successfully completed $49.5 million in Delaware Statutory Trust (DST) investments on behalf of a real estate investor who decided to relinquish a large portfolio of industrial properties in order to achieve passive management, greater diversification*, and a tax deferred 1031 exchange strategy.
According to Dwight Kay, founder and CEO of Kay Properties, the investor was referred to Kay Properties by an existing DST client who believed the Kay Properties 1031 DST marketplace combined with the high level of client-centric attention Kay Properties is known for would be beneficial to the investor.
“The investor owns a large portfolio of industrial real estate that he personally developed and managed by himself. After he received an offer, he decided it might be time to relinquish a portion of his portfolio of industrial real estate and enter into other asset classes. He knew he wanted to invest his exchange dollars into multifamily as a way to potentially hedge against inflation and diversify his concentration of industrial real estate assets. He wanted to learn more about Delaware Statutory Trusts and was referred to Kay Properties to help him develop a long-term DST business plan that would help him potentially achieve his goals and objectives,” explained Kay.
The Delaware Statutory Trust exchange investments were completed by Kay Properties and Investments team members Chay Lapin, President, Orrin Barrow, Senior Vice President, and Victor Coronado, Senior Associate.
Lapin, a nationally recognized expert in DST 1031 exchanges explained that the Kay Properties team spent approximately 12 months educating the investor on the potential benefits and risks associated with DST investments. In addition, Lapin explained that because Kay Properties has great working relationships with more than 25 different DST sponsor companies, his team was able to personally introduce the investor to investment executives from many of these firms in order to help the client start building familiarity with the various DST offerings that were available and to help build-out a long-term business plan.
“Ultimately, with this 1031 exchange, the client was looking to move away from industrial real estate and diversify into multifamily properties and self storage assets that would potentially provide him distributions and a passive ownership structure,” explained Lapin who led the Kay Properties DST team.
Orrin Barrow, Senior Vice President with Kay Properties explained that because Kay Properties applies a team approach to each DST investment, the client felt as if he had the entire Kay Properties firm working for him.
“One of the benefits of working with Kay Properties is that there is a dedicated 1031 exchange team of up to 20 people helping each client through the educational process to every detail in the closing process. In addition, due to our DST sponsor relationships, we were able to help this client successfully complete the purchase of nearly $50 million of DST investments,” said Barrow.
According to Senior Associate Coronado, one of the things that the client was especially impressed with was the ability of Kay Properties to present all of the intricacies, potential benefits, and risks of the DST exchange investments in a way that the client was comfortable with while also responding quickly to any questions he had or information he requested.
“The client was incredibly impressed with the level of personalized attention he received from the entire Kay Properties team. When the exchange was successfully completed, the client was able to exchange out of his self-managed industrial portfolio into 15 different multifamily and self storage DST offerings totalling approximately 6,000 units and a combined square footage of approximately 3 million rentable square feet. The total offering size ended up being valued at more than $1.2 billion. In addition to using DSTs to create a tax deferred 1031 exchange, the investors’ DST portfolio is well diversified*, spanning across Georgia, North and South Carolina, Virginia, Illinois, Texas, and Nevada, and includes multiple multifamily assets from at least 9 different DST real estate sponsor firms,” said Coronado.
Kay reiterated that the potential diversification* capabilities one has within the kpi1031.com marketplace is significant.
“Diversification*, although it does not guarantee profits or protect against losses, allows our clients to potentially mitigate concentration risk and is consistently one of our main objectives at Kay Properties. Although there are no guarantees and risk is always associated with real estate investing, it is through the principles of staying largely debt-free and diversifying* that clients such as this one can position defensively as we move into the future,” said Kay.
For access to a complete list of current 1031 exchange eligible DST properties visit kpi1031.com.
About Kay Properties and www.kpi1031.com
Kay Properties & Investments is a national Delaware Statutory Trust (DST) investment firm. The www.kpi1031.com platform provides access to the marketplace of DSTs from over 25 different sponsor companies, custom DSTs only available to Kay client (typically 20-40 DSTs), and a DST secondary market. Kay Properties team members collectively have over 400 years of real estate experience, are licensed in all 50 states, and have participated in over $30 Billion of DST 1031 investments.
*Diversification does not guarantee profits or protect against losses. All real estate investments provide no guarantees for cash flow, distributions or appreciation as well as could result in a full loss of invested principal. Please read the entire Private Placement Memorandum (PPM) prior to making an investment. This case study may not be representative of the outcome of past or future offerings. Please speak with your attorney and CPA before considering an investment.
** Past performance does not guarantee or indicate the likelihood of future results. No representation is made that any DST investment will or is likely to achieve profits or losses similar to those achieved in the past or that losses will not be incurred on future offerings.
There is a risk of loss of the entire investment principal. Past performance is not a guarantee of future results. Potential distributions, potential returns and potential appreciation are not guaranteed. For an investor to qualify for any type of investment, there are both financial requirements and suitability requirements that must match specific objectives, goals, and risk tolerances. Securities offered through FNEX Capital, member FINRA, SIPC.
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SOURCE Kay Properties and Investments