Campus Walk, DST Files for Chapter 11 Bankruptcy: 1031-Exchange Investors Sold the DST by PriMex May Have Claims

Campus Walk, DST — a Delaware Statutory Trust sponsored out of Aliso Viejo, California that held student-housing real estate — filed a voluntary Chapter 11 petition on July 17, 2026 in the United States Bankruptcy Court for the Eastern District of California (Case No. 26-13301). For the investors who exchanged into the trust, many of them retirees completing a Section 1031 exchange, the bankruptcy puts both their income and their principal at risk.

Carlson Law is investigating potential FINRA arbitration claims on behalf of investors who purchased beneficial interests in Campus Walk, DST through a broker-dealer or financial advisor.

What the SEC filings show

Delaware Statutory Trust interests are almost never sold directly by the sponsor. They are sold through networks of independent broker-dealers whose registered representatives are paid a commission — typically among the highest in the securities industry — on every dollar an investor places. The Form D that Campus Walk, DST filed with the SEC on January 29, 2020 confirms that this offering was no exception:

Item 12 of the Form D identifies the brokerage firms and the individual representatives who received sales compensation, including PriMex (FINRA CRD No. 29394), through registered representative Kimberly Hart (CRD No. 6470382).

The $960,485 in disclosed commissions represents roughly 9% of the total offering — money that came off the top of investors’ contributions before a single dollar went into the property.

The problem with DSTs sold to the wrong investors

DST interests are often illiquid, cannot be sold back to the sponsor, carry no voting rights, and depend entirely on a single property’s performance and the sponsor’s management. They are marketed heavily to older investors completing 1031 exchanges, who are often told the investment is a conservative, income-producing replacement for the property they sold. Student-housing DSTs in particular carry concentrated lease-up, occupancy and refinancing risk that many investors were never warned about.

Brokerage firms that sell private placements are required by FINRA rules to conduct a reasonable investigation of the issuer and the offering before recommending it to any customer (FINRA Regulatory Notice 10-22), and to have a reasonable basis to believe the investment is suitable for — and in the best interest of — each customer to whom it is recommended (FINRA Rule 2111; SEC Regulation Best Interest). Private placements sold under Rule 506 are illiquid, generally unregistered, high-risk securities that are appropriate only for a limited segment of investors. When a firm sells such an offering to a customer for whom it was unsuitable, overstates the safety of the investment, or fails to disclose its risks and the commissions involved, the firm may be liable for the customer’s losses.

Investors in Campus Walk, DST are entitled to ask whether PriMex and its representatives performed the required due diligence on the sponsor and the property, whether the risks of a single-asset student-housing trust were disclosed, and whether the nearly 9% commission load was explained.

What investors in Campus Walk, DST can do now

Investors who purchased these securities through a brokerage firm may have claims that are separate from, and in addition to, whatever they may recover as creditors in the bankruptcy case. Those claims are typically brought against the brokerage firm — not the bankrupt company — in FINRA arbitration, and they do not depend on the outcome of the bankruptcy.

If you invested in Campus Walk, DST through a financial advisor or broker-dealer, we would like to hear from you. Carlson Law represents investors nationwide in FINRA arbitration and securities litigation on a contingency-fee basis, which means you pay no attorney’s fees unless we recover money for you. Consultations are free and confidential.

If you or a loved one have suffered investment losses, please call us at 888-976-6111 or complete our contact form for a free and confidential consultation.