|
In addition to TIC's, Triple Nets and properties such as apartments, strip centers and other traditional 1031 Exchange replacement properties, 1031 Replace.Com may be able to a arrange a custom approach to your 1031 replacement property needs.
First,
1031Replace.Com has a relationship with several large real estate companies for
custom 1031 replacement property packages.
We work with these companies on
your behalf as a team to come up with a customized replacement property solution. These companies have many resources that we
may be able to tap into to complete this customized approach to satisfy your
replacement property needs.
1031Replace.Com may receive a commission from the real estate company.
Second,
we have a relationship with several real estate developers and owners in the
Tampa Bay, Florida area who have indicated an interest in transferring a
tenant-in-common interest in one of their existing properties to satisfy the
needs of 1031 Exchangers. These are
negotiated transactions for which we may receive a commission from the property
owner for arranging the deal and completing the documentation. The format of these arrangements usually
involves finding a property, agreeing by appraisal or otherwise to a value for
the entire property, computing the fraction of the value necessary to receive
sufficient replacement property to complete your tax free exchange, mutually
agreeing upon a cap rate, sometimes arranging for approval from a mortgage
lender for assumption of a portion of the mortgage, title insurance and
closing, etc. Often the purchase price
for the percentage interest will involve a premium over the actual value (to
compensate the seller for the arrangement) and can sometimes involve a
guaranteed rate of return for at least the first or second year, right of the
seller to repurchase the interest (usually at fair market value, but sometimes
with a specific escalator such as an annual percentage) within a stated number
of years, etc. We refer to these as private TIC's, but they are not always available, are heavily negotiated, may require up-front compensation to us, etc. They usually involve attorney fees as well as
other closing costs.
Also,
you may have a friend or business associate who might be willing to assist your
1031 Exchange by making a fractional interest in a property already owned by
such person available to you as replacement property. By the completion of this type of custom 1031 arrangement, you would become a tenant-in-common owner of the property with your friend or business associate. Such arrangement
are, however, usually heavily negotiated and involve attorneys to assist with
the documentation and closing. Often
there may be lender approval required also.
If you think this might be a viable alternative, we will discuss it with
you and may be able to provide document samples for such a transaction (Co-Ownership Agreement, etc.). It is not recommended, however, that you buy 1031 replacement property from a relative because of the related party rules in 1031 Exchanges.
|
