Complete Your 1031 Exchange
Delaware Statutory Trust (DST) Properties
Invest your 1031 exchange proceeds alongside leading institutions in personalized properties and portfolios of properties designed for income generation and value appreciation.
1031 Exchanges
Generates Income
Value Appreciation
Assumable Loans
Diversification
Tax Benefits
Why explore Delaware Statutory Trust (DST) properties For you 1031 exchange?
Many real estate investors use 1031 exchanges to roll the proceeds from a successful investment into a new property with higher growth potential. While this is a common strategy, it doesn't solve some of the most significant drawbacks of direct property ownership.
Lack of Diversification
A one-for-one property exchange leaves an investor's capital concentrated in a single asset, exposing them to a range of market, tenant, and location-specific risks. Creating significant diversification is challenging for many reasons.
Illiquidity
Contrary to the belief that real estate is a liquid investment, the current market often sees properties linger for over six months. This extended timeframe creates uncertainty about if and when a property will sell, and at what price.
External Risks
An owner has limited control over many factors that dictate a property's value. The performance of debt markets, tenant stability, and the desirability of a specific location or asset type can all dramatically impact an investment.
How Do DST Properties Solve These Common Concerns?
Unleash your 1031 exchange's potential by exploring opportunities to diversify your real estate portfolio, improve the quality of your holdings, and stop managing properties yourself—all without sacrificing potential income and value appreciation. Work with us to invest your 1031 exchange proceeds alongside leading institutions into personalized, diversified portfolios of properties designed for income generation and overall value appreciation.
Institutional-Quality Properties
Most real estate investors can’t afford to build a diversified portfolio of multimillion-dollar properties. Our strategies allow investors to acquire partial ownership in properties that otherwise would be out of reach.
Lower Minimum Investments
DSTs can accommodate much lower minimum investments. 1031 exchange minimums often are $100,000 or less.
External Risks
In a DST, you can acquire debt to meet 1031 exchange requirements without having to qualify for or take responsibility for the loan. The debt won't appear on your credit report or affect your credit score, yet you can still deduct your share of the interest payments. It's debt without the liability.
What is a Delaware Statutory Trust (DST)?
A Delaware Statutory Trust (DST) permits fractional ownership where multiple investors can share ownership in a single property or a portfolio of properties, which qualifies as replacement property as part of an investor’s 1031 exchange transaction. A DST takes all decision-making out of the hands of investors and places it into the hands of an experienced sponsor-affiliated trustee.
Key benefits of DST properties in a 1031 exchange
NO MANAGEMENT RESPONSIBILITIES
The DST is the single owner and agile decision maker on behalf of investors.
LIMITED PERSONAL LIABILITY
Loans are non-recourse to the investor. The DST is the sole borrower.
INSTITUTIONAL-QUALITY PROPERTY
Most real estate investors can’t afford to own multi-million dollar properties. DSTs allow investors to acquire partial ownership in properties that otherwise would be out-of-reach.
ESTATE PLANNING
All 1031 exchange investments receive a step-up in cost basis so your heirs will not inherit capital gain liabilities, and provides them with professional real estate management versus the burden of hands-on management.
DIVERSIFICATION
Investors can divide their investment among multiple DSTs, which may provide for a more diversified real estate portfolio across geography and property types.
LOWER MINIMUM INVESTMENTS
DSTs can accommodate much lower minimum investments, whereas 1031 exchange minimums often are $100,000.
INSURANCE POLICY
If for some reason the investor can’t acquire the original property they identified, a secondary DST option allows them to meet the exchange deadlines and defer the capital gains tax.
ELIMINATE BOOT
Any remaining profit on the sale of your relinquished property is considered “boot.” This remaining money becomes taxable unless you eliminate it. The excess cash (boot) can be invested in a DST to avoid incurring tax.
UNLIMITED 1031 EXCHANGEs
The DST structure allows the investor to continue to exchange real properties over and over again until the investor’s death.
Historical Performance
Delaware Statutory Trust (DST) Performance
View recently realized investment performance.
eBay San Jose, CA Campus
10-Year Holding Period
3.97x Equity Multiple
~90% LTV Assumable Debt
Phoenix Marriott Hotel
2-Year Holding Period
1.78x Equity Multiple
30.40% Annualized Return
Orlando Rental Homes
5-Year Holding Period
2.49x Equity Multiple
32.36% Annualized Return
About Us
Meet Baker 1031 Properties
At Baker 1031 Properties, why we do what we do is the foundation of everything we build. For our clients, that purpose makes a powerful difference in their experience and, more importantly, in their outcomes.
Our Advantages
A Firm Built for Family, A Partnership Designed for You.
For our clients, why we do it is just as important as what we do.
It makes a powerful difference in our clients' experience and outcomes.
The Owner's Name Is On The Door
In an era of faceless organizations owned by other equally faceless organizations, Baker 1031 Properties LLC harks back to an earlier era in the financial world: The owner's name is on the door. Clients know that Gerald F. "Jerry" Baker, III has a personal interest in maintaining the unblemished record of value, fair-dealing, and high ethical standards that has always been the firm's hallmark.
Baker 1031 Properties is a real estate securities investment brokerage firm, dedicated to helping individual real estate investors use their 1031 exchange proceeds to build diversified portfolios of institutional properties, customized to their financial goals and needs.
Jerry Baker founded the firm out of necessity, as a result of his own desire to bring institutional investment strategies to his family's own real estate portfolio. What he found was a collection of investment products and strategies that offered individuals the opportunity to leverage the same advantages as institutional investors.
The problem? A lack of access to these investments, knowledgeable experts to assist, and the ability to customize the offerings to meet your needs. We invite you to learn more about our story, experience how we are different, and discover the difference for yourself.
Real Estate Experts
It's a novel concept, believe it or not, to expect actual real estate experts to be the people you go to for real estate investments.
Many of our clients come to us after having tried finding investments through their accountant, crowdfunding websites, or a general financial advisor.
Direct Access
Work directly with the firm's founder, Jerry Baker. Jerry has participated in over $10 billion worth of real estate transactions.
Jerry believes clients deserve to work directly with him - not call centers or inexperienced employees.
Turnkey Investments
Did you know that many investment offerings in our industry aren't finalized before you commit your capital? Yikes!
We exclusively offer investment opportunities from large institutions that already own the property and have the financing fully structured. This means the day you invest, you begin collecting potential income and building potential equity immediately.
Frequently Asked Questions (FAQ)
What do investors want to know about DST properties?
What is a 1031 Exchange?
A 1031 Exchange (or "Like-Kind Exchange") is an IRS provision under Section 1031 of the Internal Revenue Code that allows an investor to defer capital gains tax and depreciation recapture when selling an investment property, provided the proceeds are reinvested into a new "like-kind" investment property.
What property qualifies as "Like-Kind" in a 1031 Exchange?
For real estate, the definition of "like-kind" is very broad. It generally means any real property held for use in a business or for investment. For example, you can exchange a single-family rental house for a commercial office building or a piece of vacant land. US property cannot be exchanged for foreign property.
What are the two critical 1031 Exchange deadlines?
There are two non-negotiable timelines: The 45-day identification period (to identify potential replacement properties after the sale of your original property) and the 180-day rule (to formally acquire one or more of the identified properties). Both periods start on the closing date of the property you sold.
Do I need a Qualified Intermediary (QI) for my exchange?
Yes. To keep the exchange valid, the sale proceeds from your original property cannot touch your bank account. A Qualified Intermediary (also called an Exchange Facilitator) is a required third party that holds the funds and manages the transaction documentation to ensure compliance with IRS rules.
How much money must I reinvest to defer all my tax?
To achieve a 100% tax deferral, you must reinvest all of the net proceeds and acquire a replacement property (or properties) that is of equal or greater value than the relinquished property, and your debt must be equal to or greater than the debt on the property you sold. Any cash or debt reduction taken out is considered "boot" and is taxable.
What is a Delaware Statutory Trust (DST) and why does it qualify for a 1031 Exchange?
A DST is a legal entity that allows multiple investors to own a fractional, beneficial interest in an institutional-grade investment property. The IRS confirmed in Revenue Ruling 2004-86 that an interest in a properly structured DST is considered "like-kind" real estate and thus qualifies as a valid 1031 replacement property.
What are the main benefits of using a DST for a 1031 Exchange?
DSTs offer several advantages: Passive real estate investment (no management duties, often called "no tenants, toilets, or trash"), Diversification (the ability to split exchange funds across multiple properties/markets), and the capacity to meet the 45-day identification deadline quickly with pre-packaged institutional-grade assets.
What types of investment properties are typically held within a DST?
DSTs often hold stable, institutional assets that generate predictable income. Common types include: DST Multifamily apartments, Triple Net Lease (NNN) DST retail, medical office buildings, self-storage facilities, and industrial warehouses.
Is there a minimum financial requirement to invest in a DST?
Yes. Most DST offerings are only available to Accredited Investors due to their structure as a Reg D Private Placement. An individual generally qualifies as an Accredited Investor with a net worth over $1 million (excluding primary residence) or annual income over $200,000 (or $300,000 with a spouse) for the past two years. The minimum investment is typically lower than buying a property outright, often starting at $100,000.
What is the typical holding period and liquidity for a DST investment?
DSTs are generally designed as long-term investments, with typical hold periods ranging from 5 to 10 years. They are considered illiquid, as there is generally no active secondary market. Investors typically receive their proceeds when the property is sold by the sponsor—a process called a "full-cycle event"—at which point they can conduct another 1031 exchange.
How does a DST differ from a Tenant-in-Common (TIC) structure?
Both qualify for the 1031 exchange, but a DST is a truly passive investment with no voting rights or management duties for the investor. A TIC (Tenant-in-Common) requires all co-owners to unanimously approve major decisions, which can complicate management and refinancing. The DST structure eliminates the risk of a "rogue" owner derailing the investment.
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Terms Glossary
Common Delaware STATUTORY Trust (DST) Terms
1031 Exchange (Tax Deferred Exchange)
A provision under IRC Section 1031 allowing an investor to sell a real estate investment property and reinvest the proceeds into a like-kind replacement property to defer capital gains tax and depreciation recapture.
45-Day Identification Period
The strict 1031 deadline that mandates the Exchanger must formally identify potential replacement properties within 45 calendar days of closing on the relinquished property.
180-Day Rule (Exchange Period)
The absolute maximum 1031 deadline by which the Exchanger must complete the purchase and close on all replacement properties.
Accredited Investor
The required investor status for most DSTs (Reg D Private Placements), generally requiring a minimum net worth over $1 million or high annual income to invest in private securities offerings.
Adjusted Basis
The original cost of the property, plus capital improvements, minus any accumulated depreciation taken. This figure is key to determining the capital gains tax to be deferred.
Boot (Cash Boot, Mortgage Boot)
Any cash or non-like-kind property received by the Exchanger (including debt relief that is not offset with new debt). Boot is the portion of the realized gain that is immediately taxable.
Debt Replacement (Debt Matching)
The necessity for the Exchanger to assume equal or greater debt on the replacement property compared to the relinquished property to avoid Mortgage Boot.
Deferred Exchange
The most common type of 1031 Exchange where the investor sells the relinquished property first, then has 180 days to acquire the replacement property.
Delaware Statutory Trust (DST)
A legal entity that allows multiple Accredited Investors to own a beneficial interest (or fractional ownership) in a large, institutional-grade real estate asset, qualifying it as a like-kind replacement property for a 1031 exchange.
Depreciation Recapture
The portion of the gain on the sale of property that is taxed at a special rate because it represents the cumulative depreciation deductions previously claimed. This is typically tax deferred in a 1031 exchange.
Diversification (DST)
A key benefit allowing an investor to split their 1031 proceeds and mitigate risk by investing in multiple DST properties across different markets or asset types (e.g., Multifamily DST, Industrial DST).
DST 1031 Exchange
The specific transaction where 1031 exchange proceeds are invested into a DST interest, which is the most common solution for passive real estate investment.
DST Sponsor (Trustee)
The professional real estate company responsible for acquiring, managing, and selling the property held within the DST structure.
Exchange Accommodation Titleholder (EAT)
The special-purpose entity that holds (or "parks") the title to either the relinquished or replacement property during a Reverse or Improvement Exchange.
Fractional Ownership Real Estate
The type of ownership structure used in DSTs and TICs, where multiple investors own a share of a single investment property.
Full-Cycle Event
The term for when the DST Sponsor sells the underlying property, marking the end of the investment and resulting in the distribution of profits (at which point the investor can typically engage in another 1031 exchange).
Improvement Exchange (Construction Exchange)
A type of 1031 exchange where funds are used to build or improve the replacement property before it is formally transferred to the Exchanger.
Like-Kind Property
A broad term in IRC Section 1031 meaning any real property held for productive use in a trade, business, or investment can be exchanged for any other such real property.
Passive Real Estate Investment
The core benefit of a DST structure, relieving the investor of all landlord responsibilities ("no tenants, toilets, or trash") as management is handled by the DST Sponsor.
Qualified Intermediary (QI)
The independent third party (exchange facilitator) required by the IRS to hold the exchange funds and manage the transaction documentation, preventing the investor from having constructive receipt of the proceeds.
Relinquished Property
The "old" property that the Exchanger sells or disposes of at the beginning of the 1031 exchange process (also called the "downleg" property).
Replacement Property
The "new" property that the Exchanger acquires to complete the 1031 exchange and defer taxes. This must be of equal or greater value than the relinquished property.
Reverse 1031 Exchange
A more complex exchange structure used when the investor needs to acquire the replacement property before selling the relinquished property.
Seven Deadly Sins of DSTs
Strict rules imposed by IRS Revenue Ruling 2004-86 that restrict the actions of the trustee (e.g., prohibiting renegotiation of leases or major capital improvements) to maintain the DST's tax status.
Tenant-in-Common (TIC)
An alternative form of fractional ownership that also qualifies for the 1031 exchange but differs from a DST because TICs typically require co-owner approval on decisions.
Three-Property Rule
A common identification method allowing the Exchanger to identify up to three potential replacement properties regardless of their fair market value.
Learn more about Baker 1031 Properties at FINRA's Broker Check
The information herein has been prepared for educational purposes only and does not constitute an offer to purchase or sell securitized real estate investments. Such offers are only made through the Sponsor’s Private Placement Memorandum (PPM) which is solely available to accredited investors and accredited entities. DST 1031 properties are only available to accredited investors (generally described as having a net worth of over $1 million dollars exclusive of primary residence) and accredited entities only. If you are unsure if you are an accredited investor and/or an accredited entity, please verify with your CPA and Attorney.
There are material risks associated with investing in DST properties and real estate securities including liquidity, tenant vacancies, general market conditions and competition, lack of operating history, interest rate risks, the risk of new supply coming to market and softening rental rates, general risks of owning/operating commercial and multifamily properties, short term leases associated with multi-family properties, financing risks, potentially adverse tax consequences, general economic risks, development risks, long hold periods, and potential loss of the entire investment principal. Potential cash flows/returns/appreciation are not guaranteed and could be lower than anticipated. Diversification does not guarantee a profit or protect against a loss in a declining market. It is a method used to help manage investment risk. Because investor situations and objectives vary this information is not intended to indicate suitability for any particular investor. This material is not to be interpreted as tax or legal advice. Please speak with your own tax and legal advisors for advice/guidance regarding your particular situation.
Securities offered through Aurora Securities, Inc. (ASI), member FINRA/SIPC. Baker 1031 Properties (Baker 1031) is independent of ASI. To access Aurora Securities’ Form Customer Relationship Summary (CRS), please click HERE. Baker 1031 Properties, Jerry Baker, and (ASI) do not offer legal or tax advice. Please consult the appropriate professional regarding your individual circumstances.
Client examples are hypothetical and for illustration purposes only. Individual results may vary.
This site is published for residents of the United States only. Representatives may only conduct business with residents of the states and jurisdictions in which they are properly registered. Therefore, a response to a request for information may be delayed until appropriate registration is obtained or exemption from registration is determined. Not all services referenced on this site are available in every state through every advisor listed. For additional information please contact +1 415 579 1660 or email [email protected].
¹The statement that "Over 30% of all experienced real estate investors work with Jerry on their 1031 exchange" is a market share estimate derived from an analysis of third-party market data as of October 2025, representing the proportional relationship between the Baker 1031 Investment investor database and an estimated total market of active real estate investors; this estimate is based on Crexi reporting a 2,000,000 user base, 80% of whom are assumed not to be agents/brokers, and 42% of activity dedicated to investment sales, from which a conservative assumption excludes 15.7% as non-investor service providers (e.g., appraisers, lenders), resulting in an estimated active investor market of 566,664; as the Baker 1031 Properties database comprises over 170,000 individuals or entities, this figure represents 30.00% of the estimated market. Important Compliance Disclosure: The figures and calculations provided constitute a market share estimate based on unverified third-party data and internal assumptions utilized to define the estimated market; Baker 1031 Properties has not independently verified the accuracy of the underlying data, and the term "experienced real estate investors" is defined exclusively by this methodology and its internal assumptions. This communication is not a guarantee of future results, a testimonial, or a statement of performance for any investment product or service, and its accuracy is subject to the inherent limitations of the underlying data and the validity of the internal exclusion assumptions.