Solutions

DSTs & Opportunity Zones

Passive real estate structures for landlords who want out of management — without a tax bill on the way out.

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Longtime property owners eventually hit the same wall: the building has appreciated enormously, the management has gotten old, and selling means a capital gains bill large enough to make staying feel mandatory. Delaware Statutory Trusts and Qualified Opportunity Zone funds both exist for exactly this moment — and both come with real trade-offs the brochures underplay.

Both are easy to buy for the tax benefit while overlooking the investment underneath.

A DST can complete a 1031 exchange into fractional, professionally managed property; a QOZ fund can defer and partially shelter gains from any source. Both are illiquid, sponsor-dependent, and easy to buy for the tax benefit while overlooking the investment underneath. Our role is the sober read: whether the structure fits your plan, and whether the specific offering is worth owning on its own merits.

Two wrappers, two different jobs

Often mentioned together; rarely interchangeable.

Delaware Statutory Trust

Completes a 1031 — real estate gains only
Fractional, professionally managed property
Hold until the sponsor sells, typically 5–10 years

Qualified Opportunity Zone fund

Defers gains from any source — stock, business, property
Development risk in designated zones
Benefits earned by holding period, on the statute's clock

The tax treatment differs, the risk differs, and the exit differs. The analysis starts with which problem you're actually solving — then whether the specific offering is worth owning on its own merits.

Illustrative structure only. Figures shown are not typical or predictive.

The moment these exist for

You're selling appreciated property and want a 1031 exchange without becoming a landlord again
You have a large gain — from real estate, a business, or stock — and are weighing a QOZ deferral
You're evaluating a specific DST or QOZ offering and want an independent opinion
You're thinking about how deferred gains eventually resolve in your estate plan

The sober read

Suitability first, product second.

Suitability first

Whether either structure belongs in your plan at all.

Offering diligence

Sponsor record, fees, leverage, and the underlying assets.

DST mechanics

1031 eligibility, timelines, and exit expectations.

QOZ mechanics

Deferral dates, holding periods, and basis step-up rules.

Liquidity analysis

What you're giving up in exchange for the tax treatment.

CPA & attorney

These decisions outlive the tax year — coordinate them.

A near-miss worth learning from

Hypothetical

A seller with a large gain and a 1031 clock already running was being pitched a QOZ fund — which can't complete a 1031 at all. The confusion is common: both defer gains, so they blur together in a sales conversation. Sorting the mechanics first turned a near-miss into a workable DST identification with days to spare.

Hypothetical scenario for illustration. Not an actual client. Individual circumstances and results differ.

Being pitched one right now? Get the independent read first.

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Asked before every commitment

Are the tax benefits worth it?

Only when the underlying investment is worth owning anyway. A mediocre property in a good wrapper is still a mediocre property — and you'll hold it for years. We evaluate the investment first and the tax treatment second, which is the order the brochures reverse.

How liquid are these?

Barely. DSTs typically hold until the sponsor sells, often five to ten years; QOZ benefits require multi-year holding periods to earn their treatment. Money you might need before then doesn't belong in either structure, whatever the tax math says.