Questions Regarding DST & TIC Brokerage

[Jordan G.]

Although I've had some success, I'm also not totally enthusiastic about it either. Obviously apt buildings are very management intensive and many of these owners would like out of them as they get older, but still need cashflow and don't want to pay taxes and capital gains. To me a DST seems like an obvious solution without quite the education curve a NNN property might require, but I may also just be ignorant.

Without going into all the reasons why/how, in my "dream" I envision myself using basically using the same skill set I have acquired to get in front of these owners (cold calling, databasing, proposing, building relationships, etc.), but presenting them with the DST as a solution. However, I have had a hard time finding much information beyond the bare basics of how this industry operates, and most of what I can find is from someone trying to sell me a DST.

Here are some questions I was hoping some members more familiar with the industry could offer me some guidance on:

• If I am trying to have access to high quality DST offerings, who are the broker dealers I should be looking into? For instance, does Inland have registered representatives that sell directly to investors? Or does Inland simply form the DST and market it to broker dealers, who in turn sell the securities to investors? Or is it a combination?
• How are registered representatives compensated? Is it a commission paid by the sponsor based on sales price? If so, what is a common/typical percentage? How much can a good DST broker make in a year?
• For those in the trenches, what are the biggest challenges and frustrations? Are owners of more traditional real estate able to wrap their arms around this and commit?
• What are the biggest negatives or turnoffs of a DST? I know that TICs had a bad stigma due to the consensus needed for decision-making, but it seems like DSTs are viewed more favorably. I understand the lower return and lack of direct control, but in my mind if the person's goal is alleviating management and has faith in the sponsor, these should be acceptable tradeoffs. Obviously there are risks as with any real estate. But are there any things that are total deal-breakers to people?
• I know I'm not the first person to think of this. Is this industry as hyper competitive as the commercial real estate brokerage industry? I feel there could be underserved demand for a solution like this for these small apartment building owners, but I am on the outside looking in. I don't know if these owners are getting peppered with calls from DST brokers the same way they are from real estate brokers, if they aren't getting calls from DST brokers because there's not much demand for it, or if it is just an underserved market.

I'm sure I will have more questions if I get some responses, but I think that should get me started. Thank you in advance for any help.