Free Checklist · The Unvarnished Series
12 Questions to Ask Before You Sign Any DST Subscription Agreement
Ask these of anyone recommending a DST — including us. A capable advisor won’t be offended. An unqualified one will be exposed, and better in the conference room than after closing.
Part A · Questions for whoever is advising you
How many 1031 exchanges have you personally completed in the last twelve months?Tenure managing your stock portfolio is not exchange experience. You want closed exchanges, recently.
How many DST sponsors can you actually offer me — and who decides that list?Roughly 85 sponsors are active industry-wide. A shelf of three or four is not the market.
Walk me through this offering’s full fee load, from selling commissions to sponsor-level fees.Upfront loads commonly run 7–15% of equity. A capable advisor itemizes them from the PPM without flinching.
What happens to my exit options if this DST converts into a REIT’s operating partnership?Once you hold OP units, your 1031 days are over. Make sure that trade is one you intend to make.
What are the three biggest ways this investment could go wrong?If the answer is a shrug, the diligence hasn’t been done — by them or for you.
Part B · Questions about the offering itself
Show me this REIT’s monthly repurchase limits — and its full redemption history since 2022.The public record shows what “periodic liquidity” meant when investors actually asked for their money.
Has this program ever prorated, gated, or suspended repurchases?A yes is not disqualifying. An evasive answer is.
How is NAV calculated, how often, and by whom?Appraisal-based NAV is an estimate, not a bid. Secondary buyers have demanded 30–50% discounts to it.
Is the 721 conversion optional for me — or at the sponsor’s discretion?A forced conversion means the timing of your biggest tax decision may not be yours.
What is my tax outcome if OP units convert to shares after the NAV has declined?Deferred gain is measured against your original basis — even if the shares are worth less than you contributed.
What percentage of current distributions is covered by operating cash flow?A distribution rate without the cash flow behind it is a numerator without a denominator.
What is the total upfront load on this offering — itemized, from the PPM, not the brochure?Selling commissions, dealer-manager fees, O&O costs, acquisition fees. All of it is in the documents.
Drawn from the Unvarnished series by Ben Carmona: Brilliant With Stocks. Guessing With Your Exchange. and Redemption Denied.
For educational purposes only. Not an offer to sell or a solicitation of an offer to buy any security. DSTs and 721 UPREIT programs are speculative, illiquid, and available to accredited investors only. Consult your own tax and legal advisors.
Want Us to Answer All Twelve?
Bring the checklist. We’ll go line by line through any offering you’re considering — ours or anyone else’s.