DST Offering Detail
Hines HREX Multifamily II DST
DST Offering Highlights
Hines HREX Multifamily II DST is a 355-unit multi-family property located in Centreville, Virginia – 25 miles west of downtown Washington D.C. Built in 2019, The Emerson is currently 93.5% occupied and offers a diverse mix of studio, 1-, 2- and 3-bedroom floor plans ranging on average from 570 – 1,342 square feet. The Emerson community is located in the affluent Centreville suburb of Arlington, adjacent to a Life Time Fitness gym, Trader Joe’s, movie theater and post office. Additionally, residents are offered direct access to several retail and entertainment businesses, including Whole Foods, Costco, Target, Orangetheory Fitness and numerous local restaurant options. The property is surrounded by several recreational parks and walking trails, as well as eight golf courses within 10-miles.
| Property Status: | Closed Offering |
|---|---|
| Property Type: | Multi-Family |
| Property State: | Virginia |
| Property City: | Centreville |
| Properties: | 1 |
| Units: | 355 |
| Offering Size: | $138,736,810 |
| Equity Offering: | $138,736,810 |
| Loan-to-Value: | 0% |
| Loan Terms: | No Debt |
| Cash Flow: | Call to Confirm |
About Hines
Hines is a fully integrated real estate investment and management firm with a 65-year history of investing in real estate assets and delivering services in acquisition, development, financing, property management, leasing, and disposition. With a presence in 285 cities across 28 countries, Hines employs approximately 4,800 people worldwide, with its headquarters in Houston.
Benefits of a Delaware Statutory Trust
Delaware Statutory Trusts are a popular 1031 Exchange replacement property option that allows for fractional ownership of high-quality institutional properties acquired by and managed by large real estate firms, referred to as DST sponsors. DSTs provide a unique and flexible solution to investment property owners who want to defer tax and continue to own investment property without the management requirements of directly owned property. Below are some of the benefits of investing in DST real estate.
- Tax Savings: DSTs allow for the deferral of federal capital gains tax, state capital gains tax, net investment income tax, and depreciation recapture tax. The tax savings can be significant, especially in states where the potential tax liability can be as high as 42%.
- Monthly Income Potential: DSTs are structured with an emphasis on cash flow for investors and typically include high-quality institutional property.
- Eliminate Active Property Management: Ownership of a DST is entirely management free.
- Eliminate Tax for Estate Beneficiaries: DSTs allow for a “step-up in basis” upon the passing of an owner (elimination of Capital Gains, Depreciation Recapture, and Net Investment Income Tax).
- Low-Cost Non-Recourse Debt Matching: Most investors have debt that must be matched in their exchange, therefor many DSTs are structured with debt in place.
- Low Risk of a Failed 1031 Exchange: Extensive DST property due diligence is prepared in advance and DST closings can occur quickly – in a matter of days.
DST Risks
DSTs offer many benefits however they are not suitable for everyone and come with risks. Therefore, DSTs are only available to accredited investors. Before deciding to invest in DST real estate, carefully consider the following considerations: Lack of liquidity, timing of exit, lack of control, and interest rates can affect financing, leasing, and appreciation. Additionally, loan modifications may not always be possible, cash flow is not guaranteed, and projected appreciation may not occur. There are also management costs and fees associated with owning DSTs which are disclosed in the prospectus. While not a precisely defined term, a high grade, institutional-grade, or institutional-quality property generally refers to a property of sufficient size and stature to merit attention from large national or international investors.
