When it comes to investing in real estate, there are many ways to do it. Most non-professional investors are familiar and comfortable with the single owner method. The investor finds and purchases a parcel of real estate with the intention to capitalize on the property’s appreciation in value. It is a very simple and direct way to enter into the real estate investment arena.
However, fractional or co-ownership investments are also a popular option that many non-professional investors never consider. They should. Fractional and co-ownership interests in real estate allow you to acquire, together with other investors, larger, more secure, more profitable and potentially more stable real estate than an individual investor could likely have acquired on his or her own.
In addition, participating in a fractional or co-ownership arrangement usually allows you to better diversify your real estate investment portfolio by acquiring interests in one or more Delaware Statutory Trusts (DST). DSTs allow for a broader range and higher grade of investments, since there can be far more owners in the pool than with a traditional real estate ownership scheme. This translates into a larger pot of cash with which to purchase first-class commercial properties that would likely be out of reach for the average investor absent the DST.