A DST minimum investment vs TIC minimum comparison starts with a structural fact, not a marketing number: a Delaware Statutory Trust sets one fixed minimum per beneficial interest, while a tenant-in-common minimum is calculated backward from the property's price and the federal cap on co-owners.
TL;DR
- A DST minimum is a fixed figure stated in the PPM; a TIC minimum is back-calculated from deal price divided by the number of co-owners.
- Revenue Procedure 2002-22 provides a 35-investor safe harbor per TIC property, which puts a floor under how large each owner's check must be.
- Revenue Ruling 2004-86 lets a DST divide beneficial interests among many investors, which is why DST minimums tend to run lower.
- Leverage changes both structures' effective minimums, because equity is calculated after property-level debt — and every minimum still has to line up with your proceeds before the 45-day deadline.
Why the DST Minimum Investment vs TIC Comparison Matters
An investor comparing a DST minimum investment vs TIC allocation is usually trying to answer one practical question: how many properties can this exchange fund. The math changes depending on which structure is on the table, and the two structures calculate their minimums in fundamentally different ways.
A DST vs TIC co-ownership investor limits comparison shows why the gap between the two minimums isn't fixed either. It widens on larger properties split among fewer co-owners and narrows on smaller deals near the 35-investor ceiling. Getting this wrong at the identification stage can leave exchange proceeds stranded against a minimum that doesn't fit.
What You'll Need
- The private placement memorandum (PPM) for any DST offering under consideration, specifically the investment summary section
- The TIC's co-ownership agreement and closing statement showing the per-owner equity requirement
- Confirmation of the offering's exemption type, Reg D 506(b) or 506(c)
- A running total of 1031 exchange proceeds available to allocate
- Your 45-day identification list and 180-day closing calendar
Comparing the Two Minimums, Step by Step
1. Locate the DST's fixed minimum in the PPM
The DST's minimum investment is a stated number, not something you calculate. Check the "Investment Summary" or "Terms of the Offering" section of the PPM for the minimum per beneficial interest, and note whether a separate figure applies to IRA or qualified-account capital.
The outcome is a single dollar figure you can compare directly against your exchange proceeds. A common mistake is confusing the "minimum offering amount," which is the floor for the entire raise to close, with the "minimum investment," which is the floor for your individual check.
2. Calculate the TIC's effective minimum from deal size and investor count
A TIC minimum isn't published the way a DST minimum is. Divide the property's total equity requirement — the purchase price minus any co-ownership-level debt — by the number of co-owners named on the closing statement.
This matters because a $12 million property split among six co-owners requires a far larger check per owner than the same property split among 30. The result is an implied minimum, and the mistake to avoid is treating TIC minimums as flexible marketing language when they're actually fixed by closing-statement math once price and investor count are set.
3. Check the investor-count cap on each TIC
Revenue Procedure 2002-22 is a safe harbor that caps a tenant-in-common structure at 35 co-owners per property for these 1031 purposes. Confirm the current committed investor count, not just the stated cap, since your per-owner minimum depends on how many co-owners actually close.
The outcome is confidence that your share of the equity requirement won't shift after you commit. The common mistake here is treating 35 as a target investor count rather than a ceiling that sponsors and closing attorneys manage around.
4. Compare the offering exemptions, 506(b) vs 506(c)
Most DST offerings are sold under a Reg D 506(b) or 506(c) exemption from registration, and the exemption type affects how accreditation is handled, not the dollar minimum itself. A 506(c) offering requires every purchaser to be verified as an accredited investor before closing, while 506(b) permits up to 35 non-accredited but sophisticated investors and relies on investor self-certification of status.
Check the exemption disclosed on the PPM's cover page. The outcome is a clear sense of how much lead time verification will take. The mistake is assuming every DST offering, or every TIC for that matter, uses the same exemption and the same verification timeline.
5. Match minimums against exchange proceeds and diversification goals
Divide total exchange proceeds by the number of properties you want to hold, then check that figure against each structure's minimum. Lower DST minimums make splitting proceeds across multiple sponsors and asset types more mechanically workable than most TIC allocations, where fewer, larger checks are typical.
The outcome is a workable allocation plan you can act on before day 45. A frequent mistake is identifying more properties on the 45-day list than your proceeds can actually fund once each structure's real minimum is applied.
6. Verify how leverage changes the capital stack
Both leveraged DSTs and leveraged TICs calculate the equity minimum after property-level debt, not before. Reading the capital structure section of the filing, as covered in reading the capital structure of a DST filing, shows the loan-to-value assumption behind the stated minimum.
The outcome is an apples-to-apples comparison of equity minimums across structures. The common mistake is comparing a leveraged TIC's per-owner minimum against an all-cash DST's minimum without adjusting for the difference in debt.
Troubleshooting
- Exchange proceeds don't divide evenly into any single DST minimum. Look at whether more than one offering, at different minimums, can absorb the full amount without leaving a residual.
- The TIC's minimum keeps rising as the sponsor finalizes the co-owner count. Ask for written confirmation of the final investor count before wiring funds, not just the term sheet's stated count.
- The PPM states a minimum but the sponsor grants exceptions for IRA custodians. Ask directly whether the stated minimum applies to individual accounts, qualified accounts, or both.
- A 506(c) verification letter is taking longer than the 45-day window allows. Request third-party verification as soon as the offering is identified, not once the deadline is close.
- Leverage assumptions differ between the DST and TIC you're comparing. Normalize both to an equity-only, all-cash basis before comparing which minimum is larger.
- The TIC agreement doesn't say whether related-party co-owners count separately toward the 35-investor cap. Confirm with counsel how the agreement treats related parties before assuming your share of the cap.
Tools and Resources
- The Top1031 directory for as-of-date active DST offerings and sponsor records
- The Top1031 Learn library for how the 45-day and 180-day rules interact with replacement-property selection
- The DST's own PPM, read directly rather than through a summarized marketing sheet
- The TIC's closing statement and co-ownership agreement
- A CPA or qualified intermediary to confirm the exchange math against the 45-day and 180-day calendar
What to Do Next
Once the minimums are lined up against your exchange proceeds, the next comparison is structural rather than numerical: how a DST's single-trustee decision-making differs from a TIC's unanimous-consent requirement among up to 35 co-owners, and how that difference plays out once you own the asset rather than just fund it.
FAQ
What is the 35-investor rule for TICs?
Revenue Procedure 2002-22 is a safe harbor that caps a tenant-in-common structure at 35 co-owners per property for these 1031 purposes. Because a property's equity is divided among those co-owners, fewer owners on a given deal means a larger check for each one.
Do DST minimum investments vary by sponsor?
Yes. Each DST sponsor sets its own fixed minimum in the private placement memorandum, disclosed alongside the offering's exemption type and offering amount. Comparing minimums across sponsors means reading each PPM directly rather than relying on marketing summaries.
Can I use IRA funds to meet a DST or TIC minimum?
Some DST offerings state a separate minimum for retirement-account investors and some do not accept IRA capital at all; the PPM's investment summary section discloses this directly. TIC agreements handle this at the closing-statement level rather than in a standardized offering document.
Does 506(b) or 506(c) affect the dollar minimum investment?
The exemption affects how accreditation is handled, not the dollar minimum itself. A 506(c) offering requires every purchaser to be verified as accredited before closing, while 506(b) permits up to 35 non-accredited sophisticated investors and relies on self-certification — and either can carry any minimum the sponsor sets.
One Last Thing
The two authorities doing the real work here rarely get named side by side. Revenue Ruling 2004-86, issued in 2004, is what lets a DST spread beneficial interests across many investors, the mechanical reason DST minimums tend to run lower. Revenue Procedure 2002-22, the older of the two, is the safe harbor that caps a TIC at 35 co-owners per property, the mechanical reason TIC minimums tend to run higher as deal size grows. Neither was written with minimum investment size in mind, yet both end up setting it — and in 2026 that math hasn't changed.