Beneficial Interest
A beneficial interest is an investor’s ownership interest in a trust, such as a Delaware Statutory Trust (DST), rather than direct deeded ownership of the real estate itself. In a DST structure, investors are beneficiaries of the trust that owns the property
Build Out
Improvements made to a ‘shell’ space. Examples of ‘building out’ a space include erecting interior walls and doors and running electrical wiring.
Boot
When the value of the Replacement Property is less than the value of the Relinquished Property, the difference in value between the two is called “boot”. Any boot that an investor receives when conducting a 1031 exchange is subject to capital gains tax that cannot be deferred as part of their 1031 transaction.
