What’s Happening in the 1031 Exchange Space

Wallace:
The DST industry. I mean, we’ve never seen anything like what’s going on right now. I think we should be … We’re projected now to be double, at least, last year and last year was a record year. What is your feeling with it? I mean, are the deal flow just getting overwhelming. Are you guys having to staff up to meet the challenge?

Brandon:
Yes. Yes, we are. I’m probably not getting as much sleep as I did about a year ago, but that’s okay. It’s very hot, I mean, as you know, Wally. I think a lot of people are probably looking to sell their highly appreciated real estate in this market and defer taxes on the gains through a Section 1031 exchange. I mean, like you said, I think we had $7 billion, in excess of $7 billion, of equity raised in the industry last year, which as you said, was a record. I think we’re seeing increased demand for this product because I think investors are being made more aware of the opportunity to defer gains into a type of program that provides other types of benefits to them and I think we’re seeing some larger, well known asset managers becoming sponsors of DST programs because they recognize the demand, they recognize the demographic shifts in the investor population and I think that these products are becoming more mainstream than they ever have before.