Delaware Statutory Trusts (DSTs) give investors access to institutional-quality real estate at minimums far lower than buying a property outright, but they aren't open to everyone or available at any amount. DST interests are securities, typically offered under the private-placement rules of Regulation D, which generally limits them to accredited investors and sets minimum investment amounts that vary by offering and by whether you're a 1031 exchanger or a cash investor. Understanding these requirements up front — what you'll need to qualify, how much you'll need to commit, how your accredited status gets verified, and how to spread your capital across DSTs — makes the process smoother and helps you plan a sensible allocation. This guide explains typical DST minimum investments, the accredited-investor definition, how accreditation is verified (including for Rule 506(c) offerings that require third-party verification), how minimums differ for 1031 versus cash investors, and how to plan your allocation across DSTs. Note that Baker 1031 Investments does not provide tax or legal advice, and DST interests are securities offered through the broker-dealer, Aurora Securities, Inc. (member FINRA/SIPC), to accredited investors after a suitability review; verify the current rules and your eligibility with your advisors.
Typical DST Minimum Investments
One of the main appeals of a DST is the low minimum relative to owning real estate directly. Rather than needing the full purchase price of a building, you buy a fractional beneficial interest in a trust, so your minimum investment is a slice of the whole. Typical DST minimums often fall in the range of roughly $25,000 to $100,000, though they vary by sponsor and offering, and some offerings set their threshold higher. This makes institutional-quality real estate — the kind of property an individual investor likely couldn't acquire alone — accessible at a fraction of the cost of buying outright.
The minimum exists for practical reasons: a DST has a limited number of investors (there are constraints on how the offering is structured and sold), and administering many tiny interests would be inefficient, so sponsors set a floor. The low-relative-to-direct minimum is also what makes diversification feasible — instead of putting all of your capital into one property, you can spread it across several DSTs in different sectors and markets, each at its own minimum. Because the exact minimum depends on the specific offering, the practical step is to review the offering's terms (disclosed in the private placement memorandum) to confirm the minimum, and to plan your total commitment around the minimums of the DSTs you're considering.
So typical DST minimums often run roughly $25,000 to $100,000 (varying by offering), giving access to institutional real estate at a fraction of a direct purchase and making diversification across DSTs feasible. So understanding minimums frames how much you'll need. Typical DST minimum investments — often in the range of roughly $25,000 to $100,000, though varying by sponsor and offering — let you buy a fractional beneficial interest rather than a whole property, opening access to institutional-quality real estate at a fraction of a direct purchase and making diversification across multiple DSTs feasible. The exact minimum is set in each offering's documents. Understanding minimums frames how much capital you'll need. DST minimums typically run roughly $25,000 to $100,000 depending on the offering, letting you access institutional real estate fractionally and diversify across several DSTs.
Accredited Investor Definition
Because DST interests are securities offered under Regulation D, they're generally limited to accredited investors. The accredited-investor definition, set by the SEC, includes a few common tests for individuals. The income test: individual income exceeding $200,000 in each of the two most recent years (or $300,000 jointly with a spouse or spousal equivalent), with a reasonable expectation of the same in the current year. The net-worth test: a net worth exceeding $1 million, individually or jointly, excluding the value of your primary residence. Meeting either test generally qualifies you as accredited.
The definition has expanded over time beyond income and net worth. Individuals can also qualify based on holding certain professional licenses (such as the Series 7, Series 65, or Series 82), and there are categories for knowledgeable employees of certain funds and for various entities (trusts, businesses, and others meeting asset or ownership thresholds). The purpose of the accredited-investor standard is investor protection: it's meant to identify investors presumed to have the financial sophistication or the financial cushion to bear the risks of private, illiquid offerings like DSTs, which aren't subject to the full disclosure requirements of public securities. So qualifying as accredited is a threshold requirement for most DST investments, and it's worth confirming your status before you begin.
So the accredited-investor definition turns mainly on income (over $200,000 single / $300,000 joint) or net worth (over $1 million excluding your home), with additional license- and entity-based paths. So meeting it is the threshold for most DSTs. The accredited-investor definition — qualifying through the income test (over $200,000 individually or $300,000 jointly in the two most recent years, with the same expected), the net-worth test (over $1 million excluding your primary residence), or expanded paths like certain professional licenses and entity categories — exists to identify investors presumed able to bear the risks of private, illiquid offerings. It's a threshold requirement for most DSTs. Understanding it confirms your eligibility. You're generally an accredited investor if your income exceeds $200,000 single ($300,000 joint) or your net worth exceeds $1 million excluding your home, with additional license- and entity-based paths.
Two simple tests open the door to most DSTs: income over $200,000 (or $300,000 with a spouse), or net worth over $1 million excluding your home — meet either, and you're generally accredited.
Verifying Accreditation
Qualifying as accredited is one thing; having that status verified is another, and how it's done depends on the type of offering. Many DSTs are offered under Rule 506(b) of Regulation D, which permits the issuer to rely on the investor's self-certification of accredited status — typically a questionnaire in the subscription documents in which you represent that you meet the income or net-worth test, absent reason to doubt it. This is the more common, lower-friction path, but it requires a pre-existing relationship and prohibits general solicitation.
Offerings made under Rule 506(c) are different: they permit general solicitation and advertising, but in exchange the issuer must take reasonable steps to verify that every investor is actually accredited — self-certification alone isn't enough. Verification for 506(c) typically involves reviewing documentation (such as tax returns, W-2s, or brokerage and bank statements for income or net worth) or obtaining a written confirmation from a qualified third party — a CPA, attorney, registered investment adviser, or broker-dealer, or a third-party verification service. Because 506(c) verification is more involved, investors in those offerings should expect to provide documentation or a verification letter. Either way, the verification step protects both the investor and the issuer by confirming that the accredited-investor requirement is genuinely met before the investment proceeds.
So accreditation is verified by self-certification under Rule 506(b) or by documented third-party verification under Rule 506(c), depending on how the DST is offered. So knowing which applies sets your expectations. Verifying accreditation — through investor self-certification under Rule 506(b) (a questionnaire representing that you meet the tests, in offerings without general solicitation) or through reasonable, documented third-party verification under Rule 506(c) (reviewing tax returns, statements, or obtaining a CPA, attorney, adviser, or service letter, in offerings that advertise) — confirms the requirement is genuinely met. Which path applies depends on the offering. Understanding it sets your expectations. Accreditation is verified by self-certification under Rule 506(b) or by documented third-party verification under Rule 506(c), so expect to provide documentation or a verification letter for 506(c) offerings.
Minimums for 1031 vs. Cash Investors
DSTs accept two broad kinds of investors, and the minimums can differ between them. A 1031 investor is exchanging the proceeds of a sold property into the DST to defer capital-gains tax; a cash investor is simply investing available cash, with no exchange involved. Both buy the same fractional beneficial interests, but their needs and the sponsor's minimums for each can vary. 1031 exchangers often have a specific dollar amount they must place to satisfy the exchange (matching their relinquished property's value and debt), so their investment is sized by the exchange rather than by a round minimum.
Because of this, some sponsors set a higher minimum for 1031 exchangers than for cash investors, or structure the offering to accommodate the exact exchange amounts exchangers need to deploy. Cash investors, by contrast, may face a lower minimum and have more flexibility in sizing their investment, since they're not constrained by exchange-matching requirements. The 1031 exchanger also has tax considerations the cash investor doesn't — replacing both equity and debt to fully defer the gain, meeting the 45- and 180-day deadlines, and coordinating with a qualified intermediary — so the DST's debt structure (non-recourse debt that helps replace the exchanger's prior mortgage) matters more to them. The practical point is to confirm the specific minimum and structure for your situation, since whether you're exchanging or investing cash can change both the minimum and how the investment is sized.
So minimums can differ for 1031 versus cash investors — exchangers are sized by their exchange amount and debt-replacement needs (sometimes a higher minimum), while cash investors often have more flexibility. So your investor type shapes the minimum. Minimums for 1031 versus cash investors — 1031 exchangers being sized by the equity and debt they must replace to defer their gain (sometimes facing a higher minimum and caring more about the DST's non-recourse debt), versus cash investors who often face a lower minimum and more sizing flexibility without exchange constraints — can differ within the same offering. Your investor type affects both the minimum and the structure. Understanding it clarifies your requirement. DST minimums can differ for 1031 exchangers (sized by their exchange equity and debt-replacement needs) versus cash investors (often lower minimums and more flexibility), so confirm the terms for your situation.
- Typical DST minimums often run roughly $25,000 to $100,000, varying by offering, giving fractional access to institutional real estate.
- Most DSTs require accredited investors — income over $200,000 single / $300,000 joint, or net worth over $1 million excluding your home.
- Accreditation is verified by self-certification under Rule 506(b) or by documented third-party verification under Rule 506(c).
- Minimums and sizing can differ for 1031 exchangers (driven by exchange and debt-replacement amounts) versus cash investors (often more flexible).
Planning Your Allocation
Once you understand the minimums and qualify as accredited, the next step is planning how to allocate your capital across DSTs. Because DST minimums are low relative to buying property directly, you can often spread a single investment (or exchange) across multiple DSTs in different sectors and markets — for example, a multifamily DST, an industrial DST, and a net-lease retail DST — to diversify rather than concentrating everything in one property. Diversification doesn't eliminate risk, but it reduces the impact of any single property, tenant, or market underperforming, which is one of the meaningful advantages of the fractional DST structure.
Sensible allocation planning weighs several factors: your total amount to invest (or exchange), each DST's minimum, the sectors and markets you want exposure to, the sponsors' track records, the fee structures, the debt levels, and how the holds line up with your time horizon. For a 1031 exchanger, allocation also has to satisfy the exchange math — replacing the right amount of equity and debt across the chosen DSTs to fully defer the gain — within the 45- and 180-day deadlines, which makes advance planning and identifying enough suitable offerings important. The goal is a diversified, suitable allocation that fits your goals, risk tolerance, liquidity needs (recognizing DSTs are illiquid for the hold), and, where relevant, your exchange requirements. A broker-dealer and your CPA can help structure an allocation that works on both the investment and tax sides.
So planning your allocation means spreading capital across multiple DSTs to diversify, weighing minimums, sectors, sponsors, fees, debt, and horizon, and satisfying any exchange math within the deadlines. So a thoughtful allocation ties it all together. Planning your allocation — using the low DST minimums to spread capital across several DSTs in different sectors and markets for diversification, weighing each offering's minimum, sponsor, fees, debt, and hold against your goals and horizon, and, for 1031 exchangers, satisfying the equity- and debt-replacement math within the 45- and 180-day deadlines — produces a diversified, suitable allocation rather than a single concentrated bet. It's the practical payoff of the structure. A thoughtful allocation ties the requirements together. Plan your DST allocation by diversifying across several offerings, weighing minimums, sponsors, fees, debt, and horizon, and meeting any exchange math and deadlines for a suitable, diversified result.
The low minimum is the secret weapon: instead of betting everything on one building, you can spread an exchange across several DSTs and several markets — diversification that direct ownership rarely allows.
Getting Started and Confirming Eligibility
Putting it together, getting started with a DST follows a fairly clear path. First, confirm your accredited-investor status — review the income and net-worth tests (or the license- or entity-based paths) and gather any documentation you might need, especially if you're considering a 506(c) offering that requires third-party verification. Second, clarify whether you're a 1031 exchanger or a cash investor, since that shapes the minimum, the sizing, and the deadlines you'll face; a 1031 exchanger should engage a qualified intermediary before selling the relinquished property and start identifying DSTs early.
Third, work with a broker-dealer to review suitable offerings, confirm each DST's specific minimum and structure in the private placement memorandum, and complete a suitability review that considers your financial situation, goals, liquidity needs, and risk tolerance. Fourth, plan your allocation across one or more DSTs to diversify and, if exchanging, to satisfy the exchange math within the 45- and 180-day windows. Throughout, remember that DSTs are illiquid for the hold, that distributions and returns are projections rather than guarantees, and that Baker 1031 does not provide tax or legal advice — your CPA and attorney handle the tax and exchange specifics. Following this path turns the minimum and accreditation requirements from obstacles into a straightforward checklist, so you can invest with confidence that you qualify and that the allocation fits your goals.
So getting started means confirming accreditation, clarifying your investor type, reviewing suitable offerings and minimums with a broker-dealer through a suitability review, and planning a diversified allocation within any deadlines. So a clear path makes the requirements manageable. Getting started and confirming eligibility — verifying your accredited status and gathering documentation, clarifying whether you're a 1031 exchanger or cash investor, reviewing suitable offerings and their specific minimums with a broker-dealer through a suitability review, and planning a diversified allocation within any exchange deadlines — turns the minimum and accreditation requirements into a straightforward checklist. The path is clear once the pieces are understood. A clear path makes the requirements manageable. Get started by confirming accreditation, clarifying your investor type, reviewing suitable offerings and minimums with a broker-dealer, and planning a diversified allocation within any deadlines.
How Baker 1031 Helps With Minimums and Accreditation
Baker 1031 Investments helps investors navigate DST minimums and accreditation requirements — understanding typical minimums, confirming accredited-investor status, completing accreditation verification, sorting out how minimums differ for 1031 versus cash investors, and planning a diversified allocation across DSTs — so you can invest with confidence that you qualify and that your allocation fits your goals.
DST interests are securities offered through the broker-dealer, Aurora Securities, Inc. (member FINRA/SIPC), to accredited investors after a suitability review. We help you confirm your accredited status (income, net-worth, license, or entity paths), complete the verification appropriate to the offering (self-certification under Rule 506(b) or documented third-party verification under Rule 506(c)), review each DST's specific minimum and structure, and — whether you're exchanging or investing cash — plan an allocation across suitable offerings that diversifies your exposure and, for 1031 exchangers, satisfies the equity- and debt-replacement math within the 45- and 180-day deadlines. Baker 1031 does not provide tax or legal advice; your CPA and attorney handle your specific tax and exchange situation, and a qualified intermediary handles the exchange mechanics. We're candid that DSTs are illiquid for the hold and that distributions and returns are projections, not guarantees — past performance does not guarantee future results. Our role is to help you meet the requirements clearly and invest only when suitable for your goals and risk tolerance.
Frequently Asked Questions
What is the typical minimum investment in a DST?
Typical DST minimum investments often fall in the range of roughly $25,000 to $100,000, though the exact figure varies by sponsor and offering, and some set their threshold higher. Rather than needing the full purchase price of a building, you buy a fractional beneficial interest in a trust that holds the real estate, so your minimum is a slice of the whole property. This low minimum relative to direct ownership is one of the main appeals of a DST: it opens access to institutional-quality real estate — the kind an individual investor likely couldn't acquire alone — at a fraction of the cost of buying outright. The minimum exists for practical reasons: a DST has a limited number of investors and administering many tiny interests would be inefficient, so sponsors set a floor. Because the exact minimum depends on the specific offering, the practical step is to review the offering's terms in the private placement memorandum to confirm the minimum, and to plan your total commitment around the minimums of the DSTs you're considering. The low minimum is also what makes diversifying across several DSTs feasible.
Do I have to be an accredited investor to invest in a DST?
Generally yes — because DST interests are securities offered under Regulation D, they're typically limited to accredited investors. The accredited-investor definition, set by the SEC, includes a few common tests for individuals: an income test (individual income over $200,000 in each of the two most recent years, or $300,000 jointly with a spouse or spousal equivalent, with the same expected in the current year) and a net-worth test (net worth over $1 million, individually or jointly, excluding your primary residence). Meeting either test generally qualifies you. The definition has also expanded to include individuals holding certain professional licenses (such as the Series 7, 65, or 82) and various entity categories. The standard exists for investor protection — it identifies investors presumed to have the sophistication or financial cushion to bear the risks of private, illiquid offerings like DSTs, which aren't subject to the full disclosure requirements of public securities. So qualifying as accredited is a threshold requirement for most DST investments, and it's worth confirming your status before you begin, especially since some offerings require formal verification.
What are the accredited investor income and net-worth thresholds?
The two most common individual tests are the income test and the net-worth test. Under the income test, you qualify if your individual income exceeded $200,000 in each of the two most recent years (or $300,000 jointly with a spouse or spousal equivalent), with a reasonable expectation of reaching the same level in the current year. Under the net-worth test, you qualify if your net worth exceeds $1 million, individually or jointly — but you must exclude the value of your primary residence from that calculation (and generally exclude mortgage debt up to the home's value, while counting any underwater portion against you). Meeting either test generally makes you accredited. Beyond these, the definition includes additional paths: holding certain professional licenses (Series 7, Series 65, or Series 82), being a knowledgeable employee of certain funds, and various entity categories meeting asset or ownership thresholds. These thresholds are set by the SEC and can be updated, so verify the current rules. Because they determine eligibility for most DSTs, confirming which test you meet — and gathering supporting documentation — is a sensible first step before investing.
How is accreditation verified for a DST?
It depends on which exemption the DST is offered under. Many DSTs use Rule 506(b) of Regulation D, which permits the issuer to rely on the investor's self-certification — typically a questionnaire in the subscription documents in which you represent that you meet the income or net-worth test, absent reason to doubt it. This is the lower-friction path, but it requires a pre-existing relationship and prohibits general solicitation or advertising. Offerings under Rule 506(c) are different: they permit general solicitation, but in exchange the issuer must take reasonable steps to verify that every investor is actually accredited — self-certification alone isn't enough. Verification for 506(c) typically means reviewing documentation (tax returns, W-2s, or brokerage and bank statements for income or net worth) or obtaining a written confirmation from a qualified third party such as a CPA, attorney, registered investment adviser, broker-dealer, or third-party verification service. So if you're investing in a 506(c) offering, expect to provide documentation or a verification letter. Either way, the verification step protects both you and the issuer by confirming the accredited-investor requirement is genuinely met before the investment proceeds.
What's the difference between Rule 506(b) and 506(c)?
Both are exemptions under Regulation D that let issuers raise capital privately without full SEC registration, but they differ mainly in solicitation and verification. Rule 506(b) prohibits general solicitation and advertising — the issuer can only offer to investors with whom it has a pre-existing, substantive relationship — and in exchange it can rely on investors' self-certification of accredited status (a questionnaire representation), as long as there's no reason to doubt it. It also permits a limited number of non-accredited but sophisticated investors, though most DSTs stick to accredited investors. Rule 506(c) permits general solicitation and advertising — the offering can be marketed more broadly — but in exchange the issuer must take reasonable steps to verify that every investor is actually accredited, meaning documentation or third-party verification rather than mere self-certification, and all investors must be accredited. So the trade-off is solicitation versus verification burden: 506(b) is quieter but lower-friction on verification, while 506(c) can advertise but requires documented verification. For a DST investor, the practical difference is whether you'll self-certify or need to provide documentation or a verification letter. Confirm which applies to any offering you're considering.
Are DST minimums different for 1031 exchangers and cash investors?
They can be. DSTs accept two broad kinds of investors: 1031 exchangers placing the proceeds of a sold property to defer capital-gains tax, and cash investors simply investing available cash. Both buy the same fractional beneficial interests, but the minimums and sizing can differ. A 1031 exchanger often has a specific dollar amount they must place to satisfy the exchange — matching the relinquished property's equity and debt — so their investment is sized by the exchange rather than by a round minimum, and some sponsors set a higher minimum for exchangers or structure the offering to accommodate exact exchange amounts. Cash investors may face a lower minimum and have more flexibility in sizing, since they aren't constrained by exchange-matching requirements. The exchanger also has tax considerations the cash investor doesn't — replacing both equity and debt to fully defer the gain, meeting the 45- and 180-day deadlines, and coordinating with a qualified intermediary — so the DST's non-recourse debt structure matters more to them. The practical point is to confirm the specific minimum and structure for your situation, since whether you're exchanging or investing cash can change both the minimum and how the investment is sized.
Why do DSTs require accredited investors?
DSTs require accredited investors because they're securities offered through private placements under Regulation D, which generally limits participation to accredited investors. The reason is investor protection. Private offerings like DSTs aren't subject to the full registration and disclosure requirements that public securities must meet, so the accredited-investor standard is used to identify investors presumed to have either the financial sophistication or the financial cushion to evaluate and bear the risks of these private, illiquid investments. DSTs carry real risks — illiquidity during a multi-year hold, no investor control, sponsor and market risk, fees, and concentration — and they're sold with offering documents rather than the extensive public disclosures of registered securities. The accreditation requirement is the regulatory mechanism that matches these higher-risk, less-disclosed offerings with investors deemed better positioned to absorb a potential loss. It's not a judgment about your intelligence or worthiness; it's a threshold based on income, net worth, professional licensing, or entity status. So if you're considering a DST, confirming your accredited status is a necessary first step, and it reflects the private, securities nature of the investment rather than an arbitrary barrier.
Can I spread one investment across multiple DSTs?
Yes — and doing so is one of the meaningful advantages of the DST structure. Because DST minimums are low relative to buying property directly (often roughly $25,000 to $100,000 per offering), you can spread a single investment or 1031 exchange across multiple DSTs in different sectors and markets — for example, a multifamily DST, an industrial DST, and a net-lease retail DST — rather than concentrating everything in one property. This diversification reduces the impact of any single property, tenant, or market underperforming, which is harder to achieve with direct ownership of a single building. For a 1031 exchanger, spreading across DSTs also helps satisfy the exchange math (replacing the right amount of equity and debt) while diversifying. Diversification doesn't eliminate risk, and each DST you add has its own fees, sponsor, debt, and hold to evaluate, so spreading capital is a balance between diversification and keeping the portfolio manageable. Plan the allocation around your total amount, each DST's minimum, the sectors and sponsors you want, and your time horizon. A broker-dealer can help structure a diversified allocation across suitable offerings that fits your goals.
How should I plan my allocation across DSTs?
Sensible allocation planning weighs several factors. Start with your total amount to invest or exchange and each candidate DST's minimum, then decide how many DSTs and which sectors and markets you want exposure to — using the low minimums to diversify across, say, multifamily, industrial, and net-lease retail rather than concentrating in one property. Evaluate each offering's sponsor track record (ideally with a demonstrated full-cycle history), fee structure, debt level, and hold period, and make sure the holds line up with your time horizon, since DSTs are illiquid for the hold. For a 1031 exchanger, the allocation also has to satisfy the exchange math — replacing the right amount of equity and debt across the chosen DSTs to fully defer the gain — within the 45- and 180-day deadlines, which makes advance planning and identifying enough suitable offerings important. The goal is a diversified, suitable allocation that fits your goals, risk tolerance, and liquidity needs, and, where relevant, your exchange requirements. A broker-dealer and your CPA can help structure an allocation that works on both the investment and tax sides, so the result is deliberate rather than ad hoc.
What documents do I need to verify accreditation?
It depends on whether the DST is offered under Rule 506(b) or 506(c). For a 506(b) offering, you generally self-certify by completing an investor questionnaire in the subscription documents, representing that you meet the income or net-worth test — so you typically don't have to submit underlying financial documents, though you should be able to support your representation. For a 506(c) offering, the issuer must take reasonable steps to verify your accredited status, so expect to provide documentation. For the income test, that often means tax returns, W-2s, or 1099s for the relevant years; for the net-worth test, it can mean recent bank, brokerage, and other account statements showing assets, plus a credit report and disclosure of liabilities, with your primary residence excluded. Alternatively, many 506(c) investors satisfy verification with a written confirmation letter from a qualified third party — a CPA, attorney, registered investment adviser, or broker-dealer — or through a third-party verification service. Gathering these documents in advance smooths the process. Because requirements vary by offering and the rules can change, confirm exactly what's needed with the broker-dealer or your advisor before you invest.
Is the primary residence included in the net-worth test?
No — your primary residence is excluded from the net-worth calculation for the accredited-investor test. To qualify under the net-worth test, you need a net worth exceeding $1 million, individually or jointly with a spouse or spousal equivalent, but you must leave the value of your primary home out of that figure. The related mortgage is generally also excluded as a liability up to the home's fair market value (so a typical mortgage doesn't count against you), but if you owe more on the home than it's worth, the underwater portion is counted as a liability that reduces your net worth. There's also a look-back rule meant to prevent inflating net worth by borrowing against the home shortly before investing. The purpose of excluding the primary residence is to base the test on investable wealth rather than home equity, which can be illiquid and hard to access. So when calculating whether you meet the $1 million net-worth threshold, count your investable and other assets, subtract your liabilities, and leave your home (and its mortgage, up to value) out. If you're close to the threshold, confirm the calculation with your advisor, since the details matter.
Can a trust or business entity invest in a DST?
Yes — entities can qualify as accredited investors and invest in DSTs, which is common for investors holding real estate or other assets through a trust, LLC, partnership, or corporation. The accredited-investor definition includes several entity categories: entities (such as corporations, partnerships, LLCs, and certain trusts) with total assets exceeding $5 million that weren't formed for the specific purpose of acquiring the securities; entities in which all the equity owners are themselves accredited investors; certain trusts with over $5 million in assets directed by a sophisticated person; and a newer 'family office' category meeting specified thresholds, among others. For a 1031 exchange, the entity structure also matters because the same taxpayer that sold the relinquished property generally must acquire the replacement — so the titling has to line up for the exchange to work. This makes coordination between your accreditation status, your entity structure, and your exchange titling important. Because entity accreditation and exchange titling can be technical, confirm both with your CPA, attorney, and the broker-dealer before investing. Baker 1031 doesn't provide tax or legal advice, so your professionals should confirm that the entity qualifies and that the titling supports the exchange.
Are DST minimums the same at every sponsor?
No — DST minimums vary by sponsor and by offering, so you can't assume one DST's minimum matches another's. While typical minimums often fall in the roughly $25,000 to $100,000 range, specific offerings set their own thresholds, and some are higher. Minimums can also differ within an offering depending on whether you're a 1031 exchanger or a cash investor, since exchangers are often sized by their exchange amount while cash investors may face a different floor. Because minimums aren't standardized, the practical step is to review each offering's terms in the private placement memorandum to confirm the specific minimum before planning your investment. This variability is worth factoring into your allocation: if you're spreading capital across several DSTs to diversify, the individual minimums determine how many offerings you can include and how you size each piece. A broker-dealer can help you identify suitable offerings and confirm their minimums so your allocation works. So treat each DST's minimum as specific to that offering, and confirm it directly rather than assuming uniformity across sponsors.
What if I'm not an accredited investor?
If you don't currently meet the accredited-investor definition, most DSTs won't be available to you, because they're offered under Regulation D exemptions that generally require accredited investors. The thresholds are income over $200,000 individually (or $300,000 jointly) in the two most recent years, or net worth over $1 million excluding your primary residence — and there are additional paths through certain professional licenses (Series 7, 65, or 82) and entity categories. If you're close to a threshold, it's worth confirming the precise calculation with your advisor, since how income or net worth is measured can matter. If you genuinely don't qualify, there are other ways to access real estate that don't require accreditation, such as publicly traded REITs (which trade like stocks through an ordinary brokerage account) or certain registered non-traded vehicles — though these differ from DSTs in important ways, including that REIT shares aren't 1031-eligible. The accreditation requirement reflects the private, illiquid, less-disclosed nature of DSTs and exists for investor protection. So if you're not yet accredited, confirm your status carefully, and discuss accreditation-friendly alternatives with a broker-dealer to find an approach that fits your situation and goals.
How does Baker 1031 help with minimums and accreditation?
We help investors navigate DST minimums and accreditation requirements — understanding typical minimums, confirming accredited-investor status, completing accreditation verification, sorting out how minimums differ for 1031 versus cash investors, and planning a diversified allocation across DSTs — so you can invest with confidence that you qualify and that your allocation fits your goals. DST interests are securities offered through the broker-dealer, Aurora Securities, Inc. (member FINRA/SIPC), to accredited investors after a suitability review. We help you confirm your accredited status (income, net-worth, license, or entity paths), complete the verification appropriate to the offering (self-certification under Rule 506(b) or documented third-party verification under Rule 506(c)), review each DST's specific minimum and structure, and — whether you're exchanging or investing cash — plan an allocation across suitable offerings that diversifies your exposure and, for exchangers, satisfies the equity- and debt-replacement math within the 45- and 180-day deadlines. Baker 1031 doesn't provide tax or legal advice; your CPA, attorney, and a qualified intermediary handle the tax and exchange specifics. We're candid that DSTs are illiquid and that distributions and returns are projections, not guarantees; past performance doesn't guarantee future results. Our role is to help you meet the requirements and invest only when suitable.
Glossary
- Minimum Investment
- The smallest amount a DST offering accepts from an investor.
- Fractional Beneficial Interest
- An investor's share of a DST that holds the real estate.
- Accredited Investor
- An investor meeting SEC income, net-worth, or other tests.
- Income Test
- Income over $200,000 single or $300,000 joint for two years.
- Net-Worth Test
- Net worth over $1 million, excluding the primary residence.
- Regulation D
- The SEC rules under which DSTs are privately offered.
- Rule 506(b)
- A Reg D exemption allowing self-certification, no advertising.
- Rule 506(c)
- A Reg D exemption allowing advertising with verified accreditation.
- Self-Certification
- An investor's representation of accredited status via questionnaire.
- Third-Party Verification
- A CPA, attorney, or service confirming accredited status for 506(c).
- 1031 Investor
- An exchanger placing sale proceeds into a DST to defer tax.
- Cash Investor
- An investor placing available cash, with no exchange involved.
- Debt Replacement
- Matching prior mortgage with a DST's non-recourse debt.
- Allocation
- How an investor spreads capital across multiple DSTs.
- Suitability Review
- Confirming a DST fits the investor before investing.
- Delaware Statutory Trust (DST)
- 1031-eligible fractional real estate held in a trust.
Sources & References
- U.S. Securities and Exchange Commission. Investor.gov — Accredited Investors (Updated Investor Bulletin)
- IRS. Rev. Rul. 2004-86
- IRS. Like-Kind Exchanges — Real Estate Tax Tips
- FINRA. Real Estate Investments
Disclosures
This article is published by Baker 1031 Investments, LLC for general educational purposes for accredited investors and is not an offer to sell or a solicitation of an offer to buy any security, nor is it tax, legal, accounting, or investment advice or a recommendation. Any securities offering is made solely through a sponsor’s private placement memorandum (PPM) following a suitability determination. Securities offered through Aurora Securities, Inc. (ASI), member FINRA / SIPC; Baker 1031 Investments is independent of ASI.
Oil & gas mineral and royalty interests and DST programs are speculative, illiquid securities sold only to verified accredited investors and involve substantial risk, including possible loss of principal, commodity-price and production-decline risk, lack of control, and the risk that an intended 1031 exchange fails to qualify for tax deferral. Whether a particular interest qualifies as like-kind real property is a fact-specific legal determination that varies by state and by the terms of the instrument. Tax results depend on your individual circumstances. Consult your own CPA and attorney before acting. Past performance does not guarantee future results.
