California Growth 1 DST targeting to develop 215 single family homes in Northern CA.
SCOTTSDALE, Ariz. – Walton Global, a global real estate investment and land asset management company, announced the launch of its California Growth 1 Delaware Statutory Trust (DST) focused on land-based investments. The offering located in Northern California is for approximately 44 acres of residential land that has been approved for 215 single-family homes.
Walton Global’s DST business line was launched in March of 2023 with its first offering, Georgia Growth 1 DST, for 103 acres and a targeted development of 206 single-family homes that is expected to close in the coming weeks. The California Growth 1 DST is the second offering now available for accredited investors.
Walton Global believes that the success of its land-based DST offering is primarily attributed to its unique strategy of providing investors with an all “growth,” investment strategy. Typically, an investment in a DST involves transferring proceeds from the sale of an investment property to another developed investment property, such as commercial buildings or multifamily units, that provide the potential for some income but minimal growth.
Walton’s approach is strategically focused on all-equity, growth opportunities targeting potentially higher investor returns than traditional DSTs, along with hold periods that are not artificially lengthened due to repayment restrictions applicable to most traditionally financed alternatives. The California Growth 1 DST exit strategy is targeted to be 3-to 5-years.
“We have been receiving a high level of interest in our DST offering since its launch in the spring and we are excited to make the California Growth 1 DST available to investors” said Katie Hubbard, SVP Capital Markets at Walton Global. “The feedback I have been getting from advisors is that our land-based offering hasn’t been seen before in the DST space and the targeted returns we’re aiming for is creating a demand from their clients We feel DST investments will remain a popular choice over the coming years and we’re happy to extend this competitive offering.”
Walton believes there is a strong potential for traditional appreciation based on market conditions, and the potential increase in value to the land upon entitlement completion by a home builder. Once a home builder signs a purchase agreement for a land parcel they expect to buy, they begin the entitlement process and eventually purchase the land to build homes. The investment in the land made by the home builder during this process is passed on to DST investors at the time of sale.
“The DST 1031 exchange is an appealing opportunity for accredited investors who are looking to diversify their portfolio, defer their capital gains taxes and preserve their capital through a hard asset by using a growth strategy,” said Matt Keister, Executive Vice President of Capital Markets at Walton Global. “We’re looking forward to expanding our offering in multiple growth areas across the United States.”
Walton leverages its decades of experience in land acquisition to continue to acquire a strong pipeline of DST properties in growth regions across the country, hold the properties for growth in value as contemplated by 1031 tax regulations and market the property after the hold period ends to its established network of top U.S. home builders. When selecting land, Walton Global focuses on key factors such as population growth and employment growth near large MSAs. Walton has transacted with more than half of the top 20 home builders in the U.S. and continues to grow its relationships. These strong relationships with top national and regional homebuilders allows them to strive to select the right land buyer to provide the potential for optimal returns for investors.
