1031 Crowdfunding Review (2026): What DST Investors Actually Pay

1031 Crowdfunding in One Minute

1031 Crowdfunding is a marketplace founded in 2014 by Edward Fernandez, based in Irvine, California. Despite its name, it mainly offers Delaware Statutory Trusts (DSTs) and similar private placements to accredited investors, often people completing a 1031 exchange after selling a property. Most offerings have a $25,000 minimum.

What a DST Is

A Delaware Statutory Trust lets several investors own shares of large properties, such as apartments or warehouses. DST interests can qualify as replacement property in a 1031 exchange, letting you defer capital gains taxes. You become a passive owner with no control over the property.

How a 1031 Exchange Works

When you sell an investment property, a 1031 exchange lets you defer capital gains tax by buying replacement property within strict deadlines: identify options within 45 days and close within 180 days. A qualified intermediary must hold the sale money. DSTs are popular because they can be bought quickly.

Fill Rates

An analysis of filings found several offerings were less than 10% filled. Ask how much of a DST is already funded before you commit.

The Fees

SEC Form D filings for its offerings show sales commissions of about 7% to 10% of the money raised on many DSTs, as reported by an analysis of those filings. That's before other costs such as acquisition, organization and asset management fees. High upfront loads mean a property must perform well just for you to break even.

Typical DST9%

Highest10%

Lower range7%

Advertised vs Filed Figures

The company advertises billions in total equity raised, while an analysis of its own offerings' Form D filings found far less sold directly through them. The advertised total may include third-party deals. Ask what the figure includes.

DST Risks

• Illiquid: no easy way to sell before the property is sold.
• No control over management decisions.
• Loads and fees reduce returns.
• Limited public financial reporting.
• Tax benefits depend on following 1031 rules exactly.

Who It Suits

Accredited investors selling a property who want to defer taxes and are comfortable with passive, long-term, illiquid ownership. It isn't for anyone who might need the money soon.

Broker-Dealer Check

Offerings are sold through a FINRA-member broker-dealer; verify it on BrokerCheck.

Before You Invest

1. Use a qualified 1031 intermediary and tax adviser.
2. Get the full fee breakdown for each DST.
3. Check the broker-dealer on FINRA BrokerCheck.
4. Read the private placement memorandum.
5. Compare several DST sponsors.

A Steadier Way to Protect Savings

Many 1031 investors are near retirement. Some diversify part of their savings into tangible assets for stability. Our top pick, Augusta Precious Metals, offers a free guide to the sales tactics retirement savers should watch for; our budget pick Noble Gold offers a free economic-crisis guide. Precious metals carry their own risks and costs.

Is 1031 Crowdfunding Legit?

Yes. It's an established DST marketplace using a registered broker-dealer. Fees are high and DSTs are illiquid. Learn about private placements on Investor.gov.

Pros and Cons

Frequently Asked Questions

Our Verdict on 1031 Crowdfunding

Useful for 1031 exchanges, but check every fee and be ready to stay locked in.

Precious metals prices can fall as well as rise, and a gold IRA carries setup, custody and storage fees. This page is general information, not financial, tax or legal advice. Consider speaking with a licensed financial professional before moving retirement savings.