Specialist · Portland, OR · Member since 2010 · 3k+ posts · 1k+ votes
What do you think about these? I have always been skeptical. I am sitting on cash in a 1031 and not happy with my options. Considering paying the tax. Would only use a portion, maybe 50% and take cash for the rest. Am in Portland Oregon market and it is next to impossible to do well buying.
@Jeff S. You and a million other investors all over the country are facing this same problem! What options are you looking at and what are you not happy with?
You should also look into qualified opportunity zone (QOZ) funds.
@Joe Sera I was just at the Oregon coast and looking at a commercial piece with a plex on it. Pretty much not happy with how inflated the properties are in my area of Portland.
Looked at that QOZ. Not much for funds yet. Still like direct ownership. How would opportunity fund help when in a fund?
@Jeff S. Agreed, nothing beats direct ownership. QOZ funds will more than likely make you a higher rate of return than DSTs since they inherently are higher risk/higher return investments. Unfortunately they don't work in all situations. For example, if you have a low cost basis and have refinanced, then a 1031 into a DST is better.
A DST might be a good option for you. You can always take a portion of cash out of your QI account and the rest into a dst to defer the capital gains tax. If you have any questions, I would be happy to help!
@Jeff S. good luck on the Oregon property. Keep the DST in mind if you need a backup ID property. Also if for some reason these two options don't end up working, know that you can still invest the proceeds into a QOZ fund to defer the capital gain tax.