A passive path to your next 1031 exchange
Horizon 1031 helps real estate owners exchange into institutional-grade property through Delaware Statutory Trusts — deferring tax, removing the hands-on work, and closing on a timeline that fits Section 1031.
Fractional ownership in property you'd otherwise need millions to buy alone
A Delaware Statutory Trust is a legal entity, formed under Delaware law, that holds title to real estate on behalf of a group of investors. Rather than buying a whole property, an investor purchases a beneficial interest in the trust — a fractional, undivided share of a much larger asset than they could acquire, manage, or finance on their own.
That share entitles the investor to a pro-rata portion of the property's cash flow and, ultimately, its appreciation when the sponsor sells. Because the IRS treats a beneficial interest as real property for exchange purposes, a DST qualifies as replacement property under Section 1031 — while offering the same depreciation benefits as owning the building outright.
The difference is who does the work. The trust holds title, the sponsor manages the asset, and the investor receives a statement and a distribution — a truly passive form of real estate ownership.
Two deadlines govern every exchange. A DST is built to meet both.
From the day you close on the relinquished property, the clock is fixed by statute — not by how quickly a deal can be found. Miss either date and the exchange breaks, with the deferred tax coming due in full.
The exchange clock
A DST's due diligence is complete before it ever reaches an investor, which is what makes it possible to identify and close well inside these windows — sometimes simultaneously.
Reduced exchange risk
The property is already acquired and vetted, so an investor buys a fractional interest rather than betting an entire exchange on one deal reaching the closing table.
Flexible investment amounts
DSTs accept any amount above the stated minimum, letting an exchanger deploy every dollar of proceeds — no cash left idle, no funds needed to close the gap.
Backup identification
A DST can be named alongside a primary replacement property, ready to absorb the exchange if that deal falls through before day 45.
Debt replacement
Most DSTs carry moderate, non-recourse leverage — roughly 20–55% LTV — so an exchanger can replace mortgage debt without personally qualifying for a new loan.
Split one exchange across several properties, asset classes, and markets
Low minimums make it practical to spread proceeds across multiple DSTs — a straightforward way to manage the concentration risk that comes with owning a single building.
Asset class and lease type
Investors seeking stable income often favor net-lease assets with long-term, credit-tenant leases that push taxes, insurance, and maintenance onto the tenant. Others lean toward shorter-lease property — multifamily, self-storage, hospitality — where rents can adjust to market faster. Many split proceeds across both, since real estate is cyclical and asset classes move through a cycle differently.
Geography
A common strategy is using a DST to reposition capital away from a market facing political risk, rising insurance costs, or softening demographics, and toward one with stronger job and population growth — without needing to find or vet a property manager in an unfamiliar city yourself.
A passive structure, backed by five layers of vetting before it reaches you
Giving up day-to-day control is the trade for a level of underwriting most individual buyers never get. Every offering we bring to a client has already passed through each of these five layers.
Sponsor underwriting
Sponsors typically underwrite hundreds to thousands of potential deals a year and bring only a small fraction to market — often closing on well under a hundred properties after reviewing several thousand.
Legal counsel review
Independent counsel drafts the offering's Private Placement Memorandum, disclosing everything material about the sponsor, the property, and the deal terms.
Third-party research
Independent research firms analyze each offering in depth, producing commentary that informs the final layer of review before it reaches a client.
Broker-dealer review
Our broker-dealer partners conduct the final, deciding review of every offering, approving or declining it against consistent underwriting standards.
Lender underwriting
For levered offerings, the lender adds its own review — confirming value through appraisal, assessing environmental risk, and underwriting to loan-to-value and debt-service coverage.
What you're giving up, in exchange for what you gain
A DST's passive nature is its main appeal — and the source of its three real trade-offs. We walk through each with every client before any property is identified.
Loss of control
You hold a beneficial interest in the trust, but the sponsor retains control of asset and property management, including the ultimate decision to sell.
Illiquidity
There is no secondary market. A DST can occasionally be sold to a third party mid-hold, but investors should plan on a full 2–10 year commitment.
Fee structure
Acquisition, sponsor, and placement fees are built into a single purchase price rather than billed separately — though DSTs are commonly acquired below appraised value, which can help offset that load.
A DST offers a simplified exchange into extensively vetted, institutional-grade property — a passive investment carrying the potential for cash flow, appreciation, and the same tax advantages as owning real estate directly.
Representative offerings across the DST marketplace
Sunbelt garden apartments
Stabilized, occupied multifamily in high-growth metros, structured for both income and appreciation potential.
Last-mile distribution portfolio
Single-tenant logistics and distribution assets leased to credit tenants on long-term, net leases.
Essential-services net lease
Freestanding, credit-tenant retail with long-term leases — built for exchangers prioritizing income stability.
Representative of the types of DST offerings typically available through our broker-dealer partners — not a current offer of any specific security. Availability, terms, and structure vary and are described in full only in each offering's Private Placement Memorandum.
Securitized 1031 exchange, built around the client
Horizon 1031 focuses exclusively on the securitized side of the 1031 exchange industry. Our advisors pair backgrounds in tax, real estate, and capital markets to help each client reach a solution suited to their situation, objectives, and risk tolerance.
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